“Historic Decline” Seen In April World Trade Volumes As V-Shaped Narrative Implodes 

New CPB World Trade Monitor data shows a “historical decline” in world trade volume in April of 12.1% compared with March. 

“Exports fell back significantly in several regions: -23% for both the eurozone and the US, -21% for Latin-America, -14% Japan, and -11% for other advanced economies. Imports declined most in Latin-America (-18%), the eurozone (-17%), the US (-11%), and other advanced economies (-15%).

“The growth in world trade during the months February to April compared with the preceding three months was -7.2%. None of the regions showed an increase, and the eurozone showed the most negative development (-13% exports, -11% imports),” CPB World Trade Monitor said. 

The world merchandise trade volume, three months moving average, shows global trade stalled in late 2017 through 2019 – turned abruptly lower during the COVID-19 pandemic. 

The world merchandise trade volume, last three months on the preceding three months, shows the virus pandemic triggered the worst declines of the global expansion. Suggesting worldwide lockdowns have triggered a recessionary shock. 

Global industrial production volume three months moving average in terms of the world, advanced economies, and emerging economies – notice how volumes leveled off between late 2017 and 2019 – then plunged during the virus lockdowns in early 2020.

Global industrial production volume, last three months on the preceding three months in terms of the world, advanced economies, and emerging economies – the virus pandemic was by far the worst shock of the entire cycle.

Around this time (late April), we noted, global economic activity may have troughed – but it won’t materialize into a V-shaped recovery as many in the Trump administration and Wall Street would like to believe. 

With world trade still in the dumps – a rise in global virus cases and deaths could derail the global recovery and lead to a prolonged downturn. 

Forget a V-shaped, try a ‘Nike swoosh’ recovery – as explained by UCLA Anderson Forecast senior economist David Shulman, who recently said the virus pandemic has “morphed into a Depression-like crisis” with no V-shaped recovery until 2023.