World Trade Growth to Moderate in Fourth Quarter, WTO Estimates
Global trade in goods should continue to expand in volume terms during the fourth quarter of 2017 but the pace of that growth should be slower than earlier in the year, the World Trade Organization said Nov. 13.
The WTO’s world trade outlook indicator combines several trade-related indices into a single composite indicator of trade growth in the near future by measuring short-run performance against medium-term trends. A WTOI reading of 100 indicates growth in line with medium-term trends, readings greater than 100 suggest above-trend growth, and readings below 100 indicate the reverse.
According to the WTO, the previous WTOI reading of 102.6 was confirmed as world trade growth remained strong in the second quarter and appears to have been stable in the third quarter as well. However, the most recent reading of 102.2 reflects a number of moderating factors. For example, the export orders component of the WTOI remains above trend but has turned downward recently. Indices for international air freight and container port throughput are also above trend but have lost upward momentum. Automobile production and sales are below trend but show signs of having bottomed out, which could indicate strengthening consumer confidence. Indices for electronic components and agricultural raw materials are both rising, although the level of agriculture raw materials trade remains below its medium-run trend.