Considering the uncertain state of so many things, global trade is still holding its own.
In its latest economic World Trade Outlook Indicator (WTOI), which sheds real-time insight on the state of merchandise trade, the World Trade Organization said the reading right now is higher than it has been since May 2011.
The indicator came in at 102.2 for March (up from 102.0 in February), and any reading above 100 points to above trend growth. This falls in line with forecasts from the WTO last month calling out trade recovery for this year and next, despite policy uncertainty.
However, tempering any positive outlook, WTO director-general Roberto Azevêdo said last month, “Weak international trade growth in the last few years largely reflects continuing weakness in the global economy. Trade has the potential to strengthen global growth if the movement of goods and supply of services across borders remains largely unfettered. However, if policymakers attempt to address job losses at home with severe restrictions on imports, trade cannot help boost growth and may even constitute a drag on the recovery.”
Policy moves are largely up in the air at present, with the U.S. working on refreshing its trade deals, Britain looking to work on bilateral deals in Europe as it makes its way out of the EU and the TPP countries working to push the deal forward without the U.S., so there’s little telling yet whether results will actually help or hurt trade growth.
For now, the WTO said trade’s growth momentum will continue through the second quarter of this year, and the WTO said it’s “cautiously optimistic about trade prospects.”
Merchandise trade volume for this month’s indicator was flat to the previous month, while export orders, international air freight and container port throughput came in well above trend for the period. The drag on that growth came from weak demand for agricultural raw materials and automotive and electronic sales.
“Without these headwinds, the WTOI would have been unambiguously above trend,” the WTO noted.