TOKYO (Reuters) - Japan's service sector sentiment index fell in October, a Cabinet Office survey showed on Tuesday, in a worrying sign that a sales tax increase is weighing on sentiment.
The survey of workers such as taxi drivers, hotel workers and restaurant staff - called "economy watchers" for their proximity to consumer and retail trends - showed the index measuring their confidence in current economic conditions was 44.0, down from 47.4 in September.
A reading below 50 suggests that more workers are pessimistic about business conditions.
The outlook index, indicating the level of confidence in future conditions, was down at 46.6 from 48.7 in September.
In its assessment of the survey, the Cabinet Office said the economy is showing signs of weakness recently but is still likely to recover moderately as a trend.
The Cabinet Office started compiling the data in comparative form in August 2001.
(Reporting by Stanley White; Editing by Chris Gallagher)