Low Trading – Stock Market and Global Trade
Trading has been a struggle in the world. Yes, both stock market trading and global trade have both been struggling. The Brooklyn Nets have had it the worst when it comes to trading, but that’s a whole different case. It’s safe to say that global trade is the prerequisite for what’s going on with the markets, and this issue presents us with many positives and negatives that shape up to make interesting scenarios for policymakers worldwide.
The World Trade Organization released a report consisting of trade data and findings on Wednesday. Due to rising interest rates and energy prices, the WTO estimates that exports and imports will only increase by 1 percent in 2023, a letdown compared to the previous estimate of 3.4 percent. The US saw their exports fall by 0.3 percent and imports fall by 1.1 percent, marking the fifth straight month of a decreasing trade deficit for the nation as it reached $67.4 billion in August. One positive note was that it looks like global inflation is cooling, and this can be credited to a decline in freight charges and costs. When supply chain problems were tight, freight costs skyrocketed which contributed to inflation in a major way but decreased trade has played a grand role in reducing those supply chain pressures. The UN explained how inflation needs to be tackled directly, and that is a great example. Although it looks like decreased trade is solving the main problem, the negative effects come along with it. Decreased imports and exports aren’t good for the economy, and it’ll certainly cause the global economy to contract next year. The WTO estimates that the global economy will grow by 2.3 percent in 2023, lowering their previous forecast of 3.3 percent and this will be exacerbated by excessive rate hikes. Time will tell whether the positives or negatives prevail as the time frames differentiate.
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I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.