Japan’s exports sustained their steepest drop in more than four years in July as U.S. tariffs continued to weigh on global commerce, clouding the outlook for economic growth at a time when personal spending remains unsteady.

Exports fell 2.6% in value from a year earlier, sliding more than the median forecast of a 2.1% decline, the Finance Ministry reported Wednesday.

The downturn, led by cars, auto parts and steel, was the biggest since February 2021. Export volumes rose by 1.2%, suggesting exporters are continuing to absorb U.S. tariff costs by cutting selling prices to preserve market share.