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World Trade Organisation predicts weak trade growth in early 2020

By Hugh Wilson

The organisation’s Goods Trade Barometer suggests global trade growth is below trend

Global trade growth will be anaemic in early 2020, according to the Word Trade Organisation's (WTO) latest Goods Trade Barometer.

The trade body said its real-time measure of trade trends fell to 95.5 from 96.6 in November, with results below 100 indicating a below-trend performance.

The barometer does not account for recent developments such as the coronavirus outbreak, which the WTO admits “may dampen trade prospects further”.

WTO trade statistics show that the volume of world merchandise trade was down 0.2 per cent in the third quarter of 2019 compared to the previous year. The barometer suggests that, while global trade figures may pick up slightly in the fourth quarter, the uptick is unlikely to be sustained. Year-on-year trade growth may fall again in the first quarter of 2020.

The organisation says the drop in performance since November was driven by declines in container shipping and agricultural raw materials.

Other indices for export orders, air freight and electronic components had stabilised, the report added, and in normal circumstances might be expected to rise in the coming months.

“However, every component of the Goods Trade Barometer will be influenced by the economic impact of COVID-19 (coronavirus) and the effectiveness of efforts to treat and contain the disease,” the report states.

Like its counterpart for services, the Goods Trade Barometer aims to gauge momentum and identify turning points in global trade growth.

FURTHER READING: Diageo cuts 2020 sales outlook as global trade picture remains cloudy

FURTHER READING: Global trade slowdown: have we reached the bottom yet?

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