Japan Business Mood Worsens on Hit From China’s Lockdown, Rising Costs

Smoke rises from a factory during the sunset at Keihin industrial zone in Kawasaki, Japan, on Jan. 16, 2017. Toru Hanai/Reuters

TOKYO—The mood among Japan’s big manufacturers’ soured for a second straight quarter in the three months to June, a central bank survey showed on Friday, hit by rising input costs and supply disruptions caused by China’s strict COVID-19 lockdowns.

But confidence among big non-manufacturers improved in the quarter, the “tankan” quarterly survey showed, suggesting service-sector firms are shaking off the drag from the pandemic as the government lifts curbs on activity.