From The Battle for Leyte Gulf: The Incredible Story of World War II’s Largest Naval Battle, by C. Vann Woodward (Skyhorse, 2007), Kindle pp. 18-20:
The Japanese propaganda between October 12 and 18  has been called “a campaign of mendacity unprecedented since Napoleon proclaimed the destruction of Nelson’s fleet at Trafalgar.” It would, in fact, provide the basis for a fascinating study of national psychology, for it seems to have involved a whole people in the toils of self-deception. The fears with which they had long lived — the penetration of our Pacific Fleet into what the Japanese themselves described as the “Essential Sea Area” — had now materialized, and their reaction can only be described as the pathology of fear. Japanese authorities announced that in the course of an action lasting six days the Imperial Navy had destroyed “60 per cent of America’s effective naval strength,” sunk “over 500,000 tons,” and sent “an estimated 26,000 American seamen to their deaths.” Admiral Halsey’s Third Fleet was claimed to be so badly shot up that it had “ceased to be an organized striking force,” while Vice Admiral Mitscher’s task force had been “completely wiped out.” The Emperor himself was directly involved in these fabrications. A special session of the Japanese cabinet met to draw up a report to the Emperor “advising him on the glorious victory,” and the Emperor received the cabinet delegation with an imperial rescript of commendation, assuring the world that “the army and naval forces acting in close co-operation have intercepted the enemy fleet and after valiant fighting have greatly damaged it.” On October 15 imperial headquarters announced a total of fifty-three American vessels sunk or damaged, sixteen of which were said to be carriers.
Any exploration of the causes of the enemy’s conduct in this regard is beyond the limits of this narrative. The extent to which the Japanese naval command was infected by the epidemic of self-deception, however, has an important bearing on the momentous strategic decisions of the next few days. Certainly the Imperial Navy’s two chief official spokesmen, Captains Kurihara and Matsushima, were implicated. It is not improbable, as Admiral Halsey and others have suggested, that the enemy was misled by the extravagant claims of his own pilots returning from their strikes against the Third Fleet. Captured documents reveal a general tendency toward consistency of exaggerations not so much by the Japanese propaganda machine as by local commanders on the spot. It is possible that Admiral Toyoda, while not taken in by extreme claims, might have concluded that the often-predicted thing had occurred — that land-based planes had so impaired the strength of our carrier force that the Imperial Fleet now had an opportunity for an all-out surface action in which it might enjoy some greater degree of parity.
Whatever the reasoning of the high command, there occurred on the 15th an abortive sortie of Japanese naval forces, which indicates something of the navy’s reaction. At midnight of October 14-15, Vice Admiral Shima’s Fifth Fleet, consisting of two heavy cruisers, one light cruiser and four destroyers, sortied from the Inland Sea. According to the testimony of Comdr. Kokichi Mori, a member of Shima’s staff, taken after the war, the admiral left the Inland Sea “to find a remnant of American force and center attack on weak points. We expected that there must be quite a number of damaged vessels.” Enemy search planes located two of the four task groups composing our forces, and the reports of what they saw were evidently sufficient to sober the headiest expectations. At any rate, the enemy ships hastily withdrew on the afternoon of the 16th before they were brought under attack.
The inflation of Japanese propaganda claims continued, however, and reached new heights after this episode. By the 19th, the day before the target date for Leyte, imperial headquarters had raised the score of ships sunk or damaged to fifty-seven, of which nineteen were said to be carriers. The Formosa “victory” was said to be “as great as the blow dealt the Czarist Russian fleet in the battle of the Japan Sea forty years ago.” On the 21st the naval spokesman Kurihara told the press that it was a victory which “far surpasses Pearl Harbor or the action off the coast of Malaya.” It is not improbable that two days later, when the entire Imperial Fleet made its last historic sortie, visions of Japanese naval triumphs of the past were still obscuring the realities of the present.