World Trade Outlook Indicator

GENEVA – The World Trade Organization (WTO) recently unveiled a new tool designed to help the business community understand which direction global trade winds are blowing.

The World Trade Outlook Indicator (WTOI) provides early insights into the direction of world trade and where it’s likely to go in the future. The WTOI presents a figure to show performance against trend. For example, a reading of 100 would indicate trade growth in line with recent trends; a reading greater than 100 would suggest above trend growth; while a reading below 100 indicates below trend growth.

“In serving as a quarterly signal of current and short-term trade conditions, the World Trade Outlook Indicator responds to strong interest from policymakers and the business community for more immediate, real time information on trade and trading conditions,” Roberto Azevedo, WTO director-general, said in a statement. “The WTOI should provide an early signal if trade is likely to slow or accelerate in the near future. At present it suggests that trade growth will remain weak into the third quarter of 2016.”

 World Trade Outlook Indicator
The World Trade Organization laid out the drivers of trade for its new indicator.

Currently, the WTOI is slightly below trend, with a reading of 99.0, and with a downward tendency in the most recent data, which indicates that trade growth will continue to be sluggish in July and August.

The WTOI was unveiled in Shanghai, China, ahead of a G20 meeting of trade leaders. The indicator is meant to complement other analysis tools such as the WTO’s long-term trade forecasts and other statistical releases. The WTOI will be updated on a quarterly basis.