Global trade deterioration continues: S&P Global Market Intelligence

Source:China Sport ShowRelease time:20-Nov-2023Clicks:

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Global trade deteriorated for the twentieth successive month in October this year, worldwide purchasing managers' index (PMI) surveys compiled by S&P Global Market Intelligence indicated. Fall in goods demand remained the key source of weakness.

This signals sustained weakness in global trade conditions going into the final quarter of the year.

The seasonally adjusted PMI new export orders index was unchanged at 48, which corresponded to a moderate decline in trade conditions, Jingyi Pan, economics associate director of S&P Global Market Intelligence, wrote on the company’s website.

Manufacturing goods trade contracted at a slightly sharper rate at the start of the fourth quarter. Companies reported weak underlying demand, softening economic conditions and destocking, coupled with pressures from tight financial conditions, which continued to limit spendings on goods.

This extended the sequence of shrinking export orders that commenced in March 2022.

Both developed and emerging markets recorded lower trade activity in October, but to varying degrees. The rate at which trade deteriorated in developed markets was little changed from September and thus remained sharp overall.

The slowdown in trade was, however, muted among emerging economies, where manufacturing exports declined only marginally and services new export business rose at a quicker pace in October.

Measured across both goods and services, trade across the majority of the top 10 economies monitored remained in doldrums at the start of the fourth quarter. The downturn was led by the European Union (EU), where export orders fell at one of the fastest rates on record, barring the pandemic period.

France and Germany notably posted especially steep drops in export orders, though both rates similarly slowed from the previous month.

The United Kingdom followed closely behind the EU, with new export orders continuing to shrink at a rate well above its 12-month rolling average. This was, however, driven primarily by falling manufacturing new export orders as new export business stabilised among service providers in the country.

Among the major emerging markets, India remained the best performer with exports sustaining a strong expansion in October. The rate of growth in India eased to the weakest since June, but remained well above the rolling 12-month average to signal solid improvements.

Russia also saw growth in new export orders across the manufacturing sector in October.

China and Brazil, however, continued to see new export business contract in October. Manufacturing conditions in Brazil worsened.