The economy "is worsening rapidly" and "in a severe situation" as the country faces its worst postwar recession, with weakness in the corporate sector dampening household spending, the government said Thursday.
In its latest monthly report, the Cabinet Office downgraded its overall economic assessment for the fifth consecutive month after data released earlier in the week showed the economy in the last three months of 2008 contracted at the fastest pace in nearly 35 years.
The office last lowered its economic assessment for five straight months in 2001.