Manufacturing activity contracted in February for the first time in 2½ years as domestic and export orders fell and factories cut output, a private business survey showed on Thursday.
The survey also showed business confidence had soured for the first time in more than six years, highlighting the growing toll that the U.S.-China trade war is inflicting on Asia's export-reliant economies and global manufacturing.
The Flash Markit/Nikkei Japan Manufacturing Purchasing Managers Index fell to a seasonally adjusted 48.5 in February from a final 50.3 in January. The index fell below the 50 threshold that separates contraction from expansion for the first time since August 2016.