WTO warns of an imminent global slowdown
- 1 month ago
According to the World Trade Organization, a quarterly leading indicator of world merchandise trade slumped to its lowest reading in nine years, therefore, policymakers should pay attention as a sharp slowdown is imminent.
The WTO’s quarterly outlook indicator, a composite of seven drivers of trade, showed a reading of 96.3, the weakest since March 2010 and down from 98.6 in November.
A reading below 100 signals below-trend growth in trade.
The WTO stated that, “This sustained loss of momentum highlights the urgency of reducing trade tensions, which together with continued political risks and financial volatility could foreshadow a broader economic downturn.”
Its forecast in last September indicated a global trade growth slowdown to 3.7% in 2019, a decrease from its estimated 3.9% in 2018.
The quarterly indicator is based on merchandise trade volume in the previous quarter, export orders, international air freight, container port throughput, car production and sales, electronic components and agricultural raw materials.
The WTO said, “Indices for export orders (95.3), international air freight (96.8), automobile production and sales (92.5), electronic components (88.7) and agricultural raw materials (94.3) have shown the strongest deviations from trend, approaching or surpassing previous lows since the financial crisis.”
Source: Smart Trend Team