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World Trade Continues To Slide As Recovery Sputters 

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World Trade Continues To Slide As Recovery Sputters 

Tyler Durden

Mon, 07/27/2020 – 04:15

New data published by CPB Netherlands Bureau for Economic Policy Analysis on Friday reveals world trade fell 1.1% in May after a 12.2% plunge in April. 

Highlights from the CPB report indicate world trade continues to decelerate:

  • World trade volume decreased 1.1% month-on-month (growth was -12.2% in April, initial estimate – 12.1%).

  • World trade momentum was -11.6% (non-annualised; -6.9% in April, initial estimate -7.2%).

  • World industrial production increased by 0.8% month-on-month (having decreased 8.5% in April, initial estimate -8.1%).

  • World industrial production momentum was -7.1% (non-annualised; -5.8% in April, initial estimate – 5.6%).

To visualize the collapse in world trade, CPB published several charts showing world merchandise trade volume to industrial production volume, all suggesting the global recovery is far from a “V.” 

World Merchandise Trade Volume 

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Industrial Production Volume 

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“Although the full impact of the pandemic is not yet reflected fully in trade statistics, it is expected to be very substantial”, said WTO director-general Roberto Azevedo, who presented the trade report to its 164 member states on Friday. 

WTO said last month that 2Q20 world trade YoY could plunge upwards of 18%. Along with slumping world trade, we noted earlier this week (July 21) that the global recovery is running on fumes.

To get a better sense of what collapsing world trade means for global stocks. Here is world trade volume versus MSCI World. 

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The reason for levitation in stocks is because of the unprecedented central bank money printing.

If readers want a hint at what could come next – here’s Gary Shilling, the president of A. Gary Shilling & Co., who belives a 1930’s-style depression in stocks is ahead. 


Source: zerohedge.com

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