Japan’s economy shrank by 7.8 percent in the second quarter of the year, posting its worst performance on record as the coronavirus pandemic ground economic activity to a near halt in April and May, the International New York Times reported. The nosedive in output in the three-month period — an annualized drop of 27.8 percent — was the third straight quarter of contraction for Japan, the world’s third-largest economy after the United States and China.

Japan’s pandemic-hit economy shrank last quarter by the most in records going back to 1955, official data is set to show Monday, with a resurgence of the virus threatening to slow a fragile recovery now under way, Bloomberg News reported. Analysts see gross domestic product contracting at an annualized pace of 27% in the three months through June. That means the world’s third-largest economy will have declined in size for three straight quarters, hit first by trade wars and a sales tax hike, then by the virus.

Vacancies at offices in central Tokyo rose by the most on record in July as the economic impact of the coronavirus pandemic continued to spread and virus-related bankruptcies in the capital reached 100, Bloomberg News reported. Office vacancies in five of Tokyo’s major business districts increased for a record fifth consecutive month, rising to 2.77% from 1.97% in June, real estate brokerage Miki Shoji Co. said on Thursday. It was the largest one-month gain on record, beating a high set in 2009 in the aftermath of the global financial crisis.

The coronavirus pandemic is deepening the pain for Japan’s regional lenders, heightening concerns that a potential wave of business closures will test policymakers’ ability to avert a damaging banking-sector crisis, Reuters reoprted. Many central government and bank officials see the risk of a crisis emerging in the next few months, when more struggling firms could go under and hit regional banks already weakened by a shrinking domestic economy and years of ultra-low interest rates.

Japan Airlines Co. posted its biggest quarterly net loss in at least eight years and decided to forgo paying an interim dividend as it contends with the devastating impact of the coronavirus, Bloomberg News reported. The carrier’s first-quarter loss was 93.7 billion yen ($890 million), the most since it re-listed on the Tokyo stock exchange in 2012 after emerging from bankruptcy. Since then, it only posted one other quarterly loss; in January-March of this year. The Covid-19 outbreak has damaged the aviation industry globally and forced airlines into unprecedented cutbacks.

Japan is trying to both contain a resurgence of the coronavirus outbreak and support the economy, especially the tourism sector, according to Chief Cabinet Secretary Yoshihide Suga, Bloomberg News reported. Striking a balance is “extremely difficult,” Suga said Sunday on public broadcaster NHK, adding the government is helping businesses avoid bankruptcies through virus relief measures such as special loan programs. The government will maintain a travel campaign that excludes Tokyo to support domestic tourism, a key growth driver for regional economies, he added.

Bank of Japan Deputy Governor Masayoshi Amamiya said the central bank will not rule out deepening negative interest rates as part of efforts to cushion the economic blow from the coronavirus pandemic, Reuters reported. But he said the BOJ must be vigilant to the cost of any such steps, warning that excessively low rates could hurt financial institutions’ profits and discourage them from lending. “When considering additional easing steps, we must be mindful than ever before of their potential side-effects,” Amamiya told a news conference on Wednesday.

Takeda Pharmaceutical Co is looking to cut sales jobs in Japan in its latest restructuring effort, as it overhauls domestic business following its $59 billion purchase (45.67 billion pounds) of Shire Plc, sources familiar with the company’s plans said, Reuters reported. Major pharma companies in Japan have scaled down their sales forces to cope with a shrinking market and cuts in drug prices imposed by the national health system.

Nissan Motor Co warned of a record $4.5 billion (3.49 billion pounds) operating loss this year and its lowest sales in a decade as the COVID-19 pandemic hampers its turnaround efforts, Reuters reported. Japan’s No.2 carmaker is battling to recover from a rapid expansion that has left it with dismal margins and an ageing portfolio, as well as revive its alliance with Renault that was rocked by the arrest of long-time boss Carlos Ghosn.

The Olympic cauldron will remain unlit and its stadium empty on Friday as the virus-triggered postponement of the Tokyo Games leaves disappointed fans wondering if it’s still worth holding on to tickets and hotel operators fretting over thousands of vacant rooms, Bloomberg News reported. Japan will still mark the day originally scheduled for the opening ceremony with a national holiday.