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Japan downgrades economic outlook to 'worsening' for 1st time in 4 months

The Japanese government, in its coincident index assessment, downgraded its economic outlook to "worsening" for the first time in four months, according to preliminary data from the country's Cabinet Office.

Japan's leading composite index, which anticipates changes in the economy's direction, came in at 91.7 in August, down from 93.7 in the prior month.

The coincident index, indicating the country's current economic state, slipped to 99.3 in August from July's 99.7. The lagging composite index, which measures the economy's turning points and business cycle phases, remained unchanged month over month at 104.7.

The country last assessed its economic outlook as "worsening" for April data.

Earlier in August, Moody's revised down its GDP growth forecasts through 2020 for 16 Asia-Pacific economies, including Japan, citing weak trade and investment growth.

Japan remains locked in a monthslong trade dispute with South Korea, which is expected to complicate the Japanese government's efforts to mitigate the effects of a planned sales tax increase later this year, according to an earlier S&P Global Ratings report.

Trade optimism for a deal between the U.S. and China has faded.

Japan's exports declined 8.2% year over year in August, with exports to China falling 12.1% while those to the U.S. dropping 4.4%.