The Republic's trade surplus with the rest of the world surged by 30 per cent in July, recovering from a sharp decline seen one month previously.

Seasonally adjusted figures released yesterday by the Central Statistics Office show that exports exceeded imports by €3.2 billion in July, up from €2.5 billion in June, the lowest surplus recorded since September 2000.

Despite the growth, the general level of trade recorded in July came in beneath levels seen in the first half of the year.

Goods worth €4.5 billion were imported over the month, compared to €5 billion in May and €5.1 billion in April. Exports totalled €7.8 billion in July, down from €8.9 billion in May and €8.2 billion in April.

Mr Austin Hughes, chief economist with IIB Bank, said the trade numbers were "exceptionally weak", particularly when compared with figures for July last year.

Exports have declined by 2 per cent on a year-on-year basis, while the value of imports has fallen by almost 1 per cent.

Mr Hughes said the fragile growth suggested "a further step down in the economy", particularly since last year's trade numbers had been low and could have been expected to "flatter" the latest data in comparative terms.

Initial estimates for August, also released yesterday, suggest that trade is likely to remain weak for the rest of the year.

The August figures show that imports fell by €501 million when compared to July, and exports were €168 million lower. Unadjusted numbers point to a monthly decline of €1.4 billion in imports and a fall of €713 million in exports.

Preliminary figures reveal a trade surplus of €2.9 billion for the month, down 10 per cent on July.

"The broader inference is that this is a picture of weakness," said Mr Hughes, who said the data had "negative implications" for the overall economy, which is largely dependent on external trade.

Figures for the period between January and July, the last month for which detailed data is available, indicate an annual growth of 4 per cent in exports, bringing the total to €56.7 billion.

Within this, exports of medical and pharmaceutical products grew by 64 per cent to €8.2 billion. Exports of electrical machinery, including computers, decreased by 11 per cent to €5.2 billion.

Over the same period, year-on-year growth in imports was flat, with goods worth €34 billion imported in the first seven months of the year.

The most substantial increase within this was seen in organic chemicals, where imports grew in value by 50 per cent to €1.4 billion.

The largest annual decline came in telecommunications equipment, where imports fell by 26 per cent to €1.5 billion.