Imports and exports in Japan have suffered their harshest blow in seven years during July, according to the latest official government data.
During the month, exports dropped by a sharp 14 percent, down from the 7.4 per cent drop in June. This was slightly below the average forecast for a 13.7 per cent decline predicted by economists, and marked the tenth consecutive month of year-on-year declines.
Meanwhile, imports dropped by an even more pronounced 24.7 per cent on a year-on-year basis, down from the 18.8 per cent fall in June and worse than the expected 20 per cent decline. In both cases, these were the weakest results seen since October 2009.
Although the country's trade surplus shrank by less than expected during July, the overall picture for Japan's international trade sector remains negative, as the strong yen is reducing the value of overseas earnings and making Japanese goods uncompetitive.
The currency is widely expected to weaken in the coming months, which will help imports and exports to recover, but a robust recovery is not expected any time soon.
Marcel Thieliant, senior Japan economist at Capital Economics, said: "With external demand sluggish, trade volumes are unlikely to stage a strong rebound."