WTO cuts global merchandise trade growth forecast to 0.8%, cites broad-based slowdown

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broad-based slowdown. The projection is less than half the 1.7 percent increase forecasted in April, as per a release issued on October 5. The international trade body cited the inflation prevailing in the United States and Europe, the sluggish economic recovery in China and the continuing Russia-Ukraine war while projecting a grim forecast for this calendar year.

“These developments have cast a shadow over the outlook for trade. The trade slowdown appears to be broad-based, involving a large number of countries and a wide array of goods," the WTO said in a release. Exciting news! Mint is now on WhatsApp Channels. Subscribe today by clicking the link and stay updated with the latest financial insights! Click here! However, the Geneva-based institution said its 3.3 percent growth projection for 2024 remains nearly unchanged from the previous estimate.

WTO furthermore expects real world GDP to grow by 2.6 percent at market exchange rates in 2023 and by 2.5 percent in 2024. Trade growth should pick up next year accompanied by “slow but stable GDP growth", it said. Sectors that are more sensitive to business cycles should stabilise and rebound as inflation moderates and interest rates start to come down, it added, but also noted that “signs are starting to emerge of supply chain fragmentation, which could threaten the relatively positive outlook for 2024".