(Bloomberg) -- Japan’s government cut its assessment of the economy for the first time in 10 months, as the country struggles through a renewed state of emergency to respond to a winter jump in coronavirus cases.

In its monthly report for February, the Cabinet Office continued to describe overall conditions as improving from a severely low base, but said consumer spending was weakening again.

Cutting the assessment is a potential signal that Prime Minister Yoshihide Suga may be paving the way for more economic stimulus down the road, as he holds on to hopes conditions can improve enough to allow the Tokyo summer Olympics to be held.

The government downgraded its view of private consumption for the first time since October, reflecting the damage from the state of emergency called last month to contain the virus in Tokyo and other major urban areas.

Assessments of capital spending, imports and corporate earnings saw an upgrade amid improving overseas trade, especially with China.

Japan’s Double-Digit Expansion Signals Resilience in Economy

Analysts see the economy falling back into contraction this quarter, with the growth resuming after that. Broad-based growth at the end of last year that included a ramp-up of business investment suggests the recovery could be back on relatively sure-footing once the emergency lifts.

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