Firms in Japan slashed spending on plant and equipment for the third straight quarter in October-December as manufacturers cut costs, casting doubt on the strength of the country's recovery as the COVID-19 pandemic hit private demand.

Weakness in capital expenditure is likely to worry policymakers counting on private-sector investment to help the world's third-largest economy decisively shake off the health crisis.

Separate data painted a more optimistic picture of the nation's job market in January.