Japan cuts its view on the economy amid a surge in COVID-19 cases which disrupted global supply chains and weighed on consumer confidence


It is the first downgrade in four months, with the government pointing to domestic and overseas virus situations as downside risks to the recovery.

"The economy continued picking up amid severe conditions due to the coronavirus, but the pace has recently been slowing.Automobile production weakened lately.. as parts supply shortages due to COVID-19 outbreaks in South East Asia have had material impacts on carmarkers."

Adding that chip shortages and a slowing recovery in China also raises the likelihood of production cuts spreading to other sectors as well.