WTO warns of slowdown in global goods trade

The World Trade Organization (WTO) reported that the Merchandise Trade Barometer fell below trend as global import demand weakened. The report published by the organization stated that growth in global merchandise trade is "likely" to slow in the final months of 2022 and in 2023. The WTO has published the Global Merchandise Trade Barometer November Report. Accordingly, the Merchandise Trade Barometer, which was 100 in October, fell to 96.2 in November. The organization predicted that global merchandise trade will slow due to weakening import demand. Readings above 100 on the barometer indicate growth above trend, while readings below 100 indicate growth below trend. The report emphasized that "as the global economy continues to be buffeted by strong headwinds," growth in global merchandise trade is likely to slow in the final months of 2022 and in 2023. The report said the decline in the organization’s Merchandise Trade Barometer in November was consistent with the WTO’s October 5 forecast, which called for global merchandise trade growth of 3.5 percent in 2022 and 1 percent in 2023, due to several related shocks, including the war in Ukraine, higher energy prices and monetary tightening in major economies. “In Europe, higher energy prices stemming from the Russia-Ukraine war will weigh on household spending and increase production costs. In the United States, monetary policy tightening will hit interest-sensitive spending in areas such as housing, motor vehicles and fixed capital investment,” the WTO report said.