The latest quarterly indicator from the WTO showed that global goods
trade growth was likely to remain weak, with a reading of 96.3,
unchanged from February, the lowest in nine years.
The WTO had last month cut the global trade growth forecast to 2.6% in
2019 from 3% in 2018 on account of rising trade tensions and increased
economic uncertainty.
Global trade weakness will extend into the second quarter and the
outlook for trade could worsen further if heightened trade tensions are
not resolved, the World Trade Organization said on Monday.
The global watchdog’s latest quarterly World Trade Outlook Indicator
(WTOI) showed that global goods trade growth was likely to remain
weak, with a reading of 96.3, unchanged from February, the lowest in
nine years.
"The outlook for trade could worsen further if heightened trade tensions
are not resolved or if macroeconomic policy fails to adjust to changing
circumstances," the WTO said, adding that the latest indicator did not
reflect major trade moves in the last few days.
The WTOI combines several component indices of trade-related data
into a single composite index that anticipates turning points in world
merchandise shipment volumes.
“The latest result was driven by declines in all but two component
indices,” the organisation said.
As per the indicator, indices for international air freight (92.3),
automobile production and sales (92.2), and agricultural raw materials
(92.4) fell further below-trend. The index for container port throughput
(101.0) also declined but remained above 100, suggesting growth in line
with recent trends. Indices for export orders (96.6) and electronic
components (96.7) appear to have bottomed out, even as both remained
firmly below-trend.
Readings of 100 indicate growth in line with medium-term trends;
readings greater than 100 suggest above trend growth, while those
below 100 indicate the opposite.
The WTO had last month cut the global trade growth forecast to 2.6% in
2019 from 3% in 2018 on account of rising trade tensions and increased
economic uncertainty.
Source: The Economic Times, India Tuesday, 21 May 2019