The government downgraded its assessment for March in its monthly economic report for the first time in three months, excluding the word "recovery" for the first time since July 2013.
"The economy is in a severe situation, and is extremely depressed" due to the spread of the new coronavirus, according to the report released Thursday.
The monthly report for February said the economy was recovering at a moderate pace while increased weakness mainly among manufacturing has continued.
In the report, the word "severe" was used for the first time since July 2012, when the nation's economy had been affected by the 2011 Great East Japan Earthquake.
The government concluded that the situation has deteriorated rapidly since the second half of February due to a decrease in the number of visitors to Japan and domestic tourists, the voluntary suspension or cancellation of events and the rapid decline in overseas economies, among other factors.
In the latest report on the domestic economy, the government downgraded its view on seven of the 11 items that were compared to the previous month.
The government downgraded private consumption from "picking up" in the February report to "weakened by the effects of virus infection" in the March report, indicating its concern over the employment situation.
The view on the global economy has also been revised, with the report saying "economic activity is suppressed, which is leading to a dramatic slowdown in the economy." The report also said there is further risk of an economic downturn.
The government downgraded the economic assessment for China, South Korea, and other Asian nations as well as eurozone countries.
Regarding the United States, which has experienced an increase in the number of people infected with the virus, the government said the country also has been depressed recently.
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