WTO says global trade growth will slow down in the first quarter of 2019

Sustained loss of momentum highlights the urgency of reducing trade tensions.

The World Trade Organization’s (WTO) latest trade indicator data (WTOI) indicates that global trade weakness is likely to extend into the first quarter of 2019.

According to the international organization, the simultaneous decline of several trade-related indicators should put policy makers on guard for a sharper slowdown should the current trade tensions remain unresolved.

The most recent WTOI reading of 96.3 is the weakest since March 2010 and below the baseline value of 100 for the index, signalling below-trend trade expansion into the first quarter.

This sustained loss of momentum highlights the urgency of reducing trade tensions, which together with continued political risks and financial volatility could foreshadow a broader economic downturn.

The WTO downgraded its trade forecast last September amid escalating trade disputes and tighter credit market conditions. Trade growth is currently forecast to slow to 3.7% in 2019 from an expected 3.9% in 2018, but these estimates could be revised downward if trade conditions continue to deteriorate.