Global goods trade shows turnaround in Q2 2023

The assurance of sustained recovery in Q3 and beyond seems uncertain, particularly given the barometer's weak export orders component, WTO said in a press release.

The merchandise trade volume decreased by 1.0 per cent year-on-year and 0.3 per cent quarter-on-quarter in the first quarter of 2023, continuing a downturn that initiated in the fourth quarter of 2022. This slump has been attributed to various factors, such as high food and energy costs related to the Ukraine conflict, and tighter monetary policies to combat inflation in developed nations.

While global import demand has been weak due to slow economic growth in major economies like the European Union and China, the current outcomes are slightly below WTO's earlier trade forecast on April 5, which had predicted a 1.7 per cent growth in merchandise trade for 2023. The target, however, remains within reach if trade growth accelerates in the latter half of the year.

Among the barometer's component indices, most were slightly under trend in their latest readings, including the export orders index (97.6), container shipping index (99.5), air freight index (97.5), and raw materials index (99.2).

The Goods Trade Barometer serves as a composite leading indicator for world trade, supplying real-time insights into merchandise trade's trajectory compared to recent trends. A reading above 100 is associated with above-trend trade volumes, whereas values less than 100 indicate a fall below trend or an impending dip.

Fibre2Fashion News Desk (KD)