Pressured by the Middle East outlook and sluggishness in the services sector, Japan's Economy Watcher Survey index struck a four-year low in April, declining for a second-straight month, reported the Cabinet Office on Wednesday.
The seasonally adjusted Economy Watcher Survey current conditions index fell to 40.8 in April from 42.2 in March, the lowest reading since the pandemic era.
Readings above 50 on the index point to optimism, while below 50 in the monthly poll indicates pessimists outnumber optimists, according to the Cabinet Office.
"The view of the Economy Watchers indicated in this survey result is that 'the economy is showing weakness in the recent recovery movements, mainly due to the downward pressure on sentiment caused by the situation in the Middle East,'" said the Cabinet Office, in a prepared statement.
The Japan Economy Watchers Survey measures the economic sentiment of workers in consumer-facing industries, such as taxi drivers, hotel staff, and restaurant employees.
Employees in food and beverage industries were among the most pessimistic in April, logging a current conditions index of 34.6, down from 38.4 in March, according to official figures.
Despite current qualms, the Economy Watchers forward-looking sentiment index judgment in April edged up to 39.4 from 38.7 ii March, though still in the pessimism zone, said the Cabinet Office.
The April Economy Watchers survey results are roughly in line with other recent official reports on the Japanese economy.
For example, in late April the Bank of Japan revised downwards its forecast for growth of the nation's gross domestic product (GDP) in fiscal 2026 (started April 1) to 0.5% from the previous 1%, citing Middle East pressures.
The Economy Watchers survey contacts about 2,000 frontline service-sector employees each month, and is conducted from the 25th to the 30th of each month, according to the Cabinet Office.
