Global trade: Upside surprise in August, still 2016 will be a disappointment - ING

Daniel Bosgraaf, Economist at ING explained that global trade figures surprised to the upside in August, but he warned that still, 2016 will be a disappointment. 

Key Quotes: 

“The volume of trade in goods grew 1.5% MoM in August, according to data released this afternoon by The Netherlands Bureau of Policy Analysis (CPB). This is good news after the -1.1% contraction in July. Imports have grown almost everywhere, with only Japan showing a contraction. Emerging Economies lead with an average increase of imports of 2.9%, whereas Advanced Economies show an increase of 1.1%. Figures on exports for Emerging Economies (+1.3%) and Advanced Economies (+1.2%) were very close.”

“If we look at the first eight months of 2015 against the first eight of 2016, trade has not grown at all. However, the trade volumes in the last four months of 2015 were low, possibly allowing 2016 to end on a positive note.”

“Fundamentally, world trade is facing many challenges: protectionist measures are outnumbering liberalising measures, re-shoring, greenfield investment and a slowdown of global value chain expansion all continue to weigh heavily on world trade. In addition, trade agreements are extremely unpopular with the public.”