World trade drops sharply in September
Data dashes hopes that worst of global downturn had passed
World trade contracted sharply in September, dashing hopes that the global downturn that has been weighing on exporters had bottomed out.
The volume of global trade dropped 1.3 per cent in September compared to the previous month, down from a 0.5 per cent expansion in August, according to data from the CPB World Trade Monitor.
The September fall reverses the gains made in the previous two months, which had raised hopes that the worst of the disruption caused by the global trade war has passed.
“While news about the negotiations between the US and China is mixed at best, trade remains subdued,” said Timme Spakman, an economist at ING.
Compared to the same month last year, global trade contracted 1.1 per cent in September, marking the fourth consecutive year-on-year contraction and the longest period of falling trade on this metric since the international crisis in 2009.
The US and China were the largest drag on international trade, largely reflecting the two-year long trade war between the world’s two biggest economies.
US import volumes fell 2.1 per cent in September compared to the previous month. In China, imports were down 6.9 per cent.
The index for global industrial production, also produced by CPB, was marginally more upbeat, with a 0.5 month-on-month expansion in September, up from a 0.1 per cent increase in August. However, the growth was exclusively Asia-driven, with most other industrial regions continuing to contract.