News
Global merchandise trade is continuing to recover in 2021 following a steep but brief pandemic-induced drop in the second quarter of last year, according to the latest World Trade Organization (WTO) Goods Trade Barometer released on May 28.
The Goods Barometer is a composite leading indicator for world trade, providing real-time information on the trajectory of merchandise trade relative to recent trends. The barometer's current reading of 109.7 is nearly 10 points above the baseline value of 100 for the index and up 21.6 points year-on-year, reflecting both the strength of the current recovery and the depth of the COVID-19 shock last year.
In the latest month, all of the barometer's component indices were above trend and rising, highlighting the broad-based nature of the recovery and signaling an accelerating pace of trade expansion.
Among the barometer's component indices, the biggest gains were seen in export orders (114.8), air freight (111.1) and electronic components (115.2), all of which are highly predictive of near-term trade developments. The strength of the automotive products index (105.5) may reflect improving consumer sentiment, since confidence is closely linked to sales of durable goods. This is also true of agricultural raw materials (105.4), which are mostly made up of wood intended for housing construction. Finally, the strong showing for container shipping (106.7) is more impressive in light of the fact that sea shipments held up well during the pandemic and had less ground to make up as a result.
