Japanese business confidence has plummeted to a record low as major manufacturers face up to more export misery and a domestic economy mired in its worst recession since the war.
According to the Bank of Japan's "tankan" survey, a closely watched indicator of confidence among major producers of cars, electronic and other equipment, business sentiment dropped to -58 in the first quarter, the sixth straight quarter of decline.
In a sign of the pessimism now gripping Japanese boardrooms and factory floors, the last survey, in December, produced a reading of -24.
Today's figure is slightly worse than the previous record low of -57 in 1975, which came when Japan was still reeling from the oil crisis of the previous year.
The central bank arrives at the results by subtracting the percentage of pessimistic firms from those saying the outlook is good: the lower the number, the greater the pessimism.
Japan's huge industrial base, a vital asset when demand is strong, is now a major factor behind its economic woes.
Exports have halved in the past year, unemployment is expected to rise further and worried consumers are tightening their belts.
Manufacturers cited difficulty in securing loans for fresh investment, with larger firms expected to lower capital investment by an average of 13.2% through to March 2010.
To compound the misery, the government appears unable to chart a course out of the quagmire, despite the announcement yesterday of a third stimulus package since last October.
Japan has already committed ¥12tn (£84bn) of extra spending to boost demand, including a widely derided one-off cash payment to each resident of ¥12,000 and a controversial move to reduce toll fees.
The latest package, rumoured to cost ¥10tn, is designed to create 2m jobs after data showed unemployment soared to a three-year high February.
The data suggested the exporters' gloomy outlook is shared among firms in the service and retail sectors, the driving force behind 70% of the economy, with sentiment among non-manufacturers falling from -9 to -31.
The data underlined the size of the task facing Japan's prime minister, Taro Aso, as he flew to London to attend the G20 financial summit.
In the absence of new policy initiatives, the economy is unlikely to begin to turn around until the second half of the year at the earliest, and yesterday the OECD said Japan's economy would shrink by 6.6% this year – compared with 4% in the US and 4.1% in the eurozone.
"This is a reflection of the severe state of the economy," said the government's top spokesman, Takeo Kawamura. "We urgently need to draw up new stimulus measures."
Norio Miyagawa, a senior economist at Shinko Research Institute, warned that a return to growth was still some way off. "The economy may reach a bottom in the summer but is not likely to return to previous levels of growth anytime soon," he said.
"The BoJ may buy more government bonds, commercial paper and corporate bonds to help company financing. It wouldn't do much good to lower benchmark rates, and I don't think they want to return to quantitative easing."