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VIRUS OUTBREAK

Japan Feb factory activity shrinks on Covid-19 hit

Tokyo

JAPAN'S factory activity was hit by its sharpest contraction in nearly four years in February, raising a red flag over manufacturing in the world's third-largest economy as the impact from the Covid-19 outbreak spreads.

The manufacturing slowdown offers the clearest evidence yet of the epidemic's damaging effects on global growth and businesses and is likely to ramp up pressure on Japanese policymakers to boost growth.

The au Jibun Bank Japan Manufacturing Purchasing Managers' Index (PMI) slipped to a seasonally-adjusted 47.8 from a final 48.8 in the previous month.

The February reading was its lowest since May 2016.

The index stayed below the 50.0 threshold that separates contraction from expansion for a 10th month, marking the longest stretch since a 16-month run to June 2009 during the global financial crisis. REUTERS