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Tensions take their toll of world trade

[ November 19, 2019   //   ]

World merchandise trade is expected to remain below trend into the fourth quarter of 2019, according to the World Trade Organisation (WTO) latest Goods Trade Barometer. The reading of 96.6 is a slight improvement over the 95.7 registered in August, but it remains well below the index’s baseline value of 100. (Readings of 100 indicate growth in line with medium-term trends; readings greater than 100 suggest above-trend growth, while those below 100 indicate below-trend growth.)

Indices for export orders (97.5), automotive products (99.8), and container shipping (100.8) have firmed up but international air freight (93.0), electronic components (88.2), and raw materials (91.4) have all deteriorated further. Electronic components trade was weakest of all, possibly reflecting recent tariff hikes affecting the sector.

In September, WTO economists downgraded their its growth expectations for 2019 to 1.2%, down from the 2.6% forecast in April. They attributed this substantial deceleration to slowing economic growth, increased tariffs, Brexit-related uncertainty, and the shifting monetary policy stance in developed economies.

https://www.wto.org/english/news_e/news19_e/wtoi_18nov19_e.pdf

 

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