The Cabinet Office believes the economy is recovering moderately despite some weakness, according to its monthly report for February released on Thursday. The report warned, however, of risks from uncertainty overseas.

The Cabinet Office downgraded its assessment of the world economy for the first time since last August due in part to corporate weaknesses in the United States and the eurozone.

Japan is "on a moderate recovery, while weakness can be seen in some areas," it said, leaving unchanged its assessments of all 14 categories. The government retained its assessment of corporate profits as "improving."