World economy dynamics has achieved its peak at the turn of 2017 and 2018 and since then has been slightly slowing down. Among the indicators which illustrates this development quite well is world goods trade dynamics.
Source: CPB World Trade Monitor, Conseq
We can see on the chart that it achieved a local maximum in October 2018 when the dynamics recorded a pace of +5.6 % y/y. Since then the dynamics has slowed sharply down and according to the latest figures for November 2019 the world trade dynamics was negative of -1.1 % y/y. Moreover the decline was 0.6 % m/m. Taking into account the coronavirus epidemic it is very likely that the dynamics will fall even deeper into negative territory at the beginning of this year. And this is definitely not good news for revenues and earnings dynamics of big international publicly quoted corporations.
Michal Stupavský
Investment Strategist Conseq Investment Management, a.s.