World goods trade volumes have been edging downward since March, and according to Oxford Economics' survey-based indicator, this suggests further short-term weakness. There is much variation across sectors and economies, but overall, risks to the Oxford Economics’ trade forecasts for 2021 and, especially, 2022 now look skewed to the downside.
The weakening trend in goods trade is visible in both advanced and emerging markets, but with an uneven pattern across economies. Asian trade levels have moderated, and trade in the United States and euro area looks flat. Trade is weak in the Middle East and Africa but rising in Latin America.
Some of the slowdown represents Chinese exports retreating from artificially high growth rates associated with the pandemic. But less benign factors are also in play, including ongoing restrictions, port closures, and soaring shipping rates and other supply disruptions.
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