The Global Economy: US manufacturing survey shows worst reading in a decade and the WTO downgrades the trade volume


We begin today with the aforementioned slice of the American economy manufacturer ing the Caveat here is that you can't can't tell the whole story of this economy from just one number of course but a report we got today about. US manufacturing is causing a little bit of Aga it comes to was from the Institute for Supply Management. It provides an index or whether the manufacturing is expanding or contracting from month to month. That's Sharyn o'halloran. She's professor of Political Economy at Columbia. The manufacturing index came out. This morning is pretty straight ahead. If it's above fifty fifty manufacturing is expanding below that it's shrinking what we've seen in this latest report is that the index spell below fifty forty seven point eight to be precise signifies. A worsening of manufacturing tring conditions in the in the United States that is manufacturing industries are facing a downturn. Today's number was in fact. The lowest is the index has been in more than ten years manufacturing is not the largest component of the economy is a significant component when there's a contraction in manufacturing other types of sectors will probably follow because it could be layoffs it could be different types of negative activities that are going to happen as a result of it so what is going on here. You know really indicates to me that what's driving. This is our lack of new export orders. That's Timothy Furey. SM He chairs the committee that puts out the survey in question this is more of I think it's more more of a trade throttling it's it's caused a lot of bottlenecks across the global environment not good for the manufacturing economy yeah not good for the manufacturing fracturing. Konami all spink trade bottlenecks and throttling of the global environment let us turn now to the WTO the World Trade Organization. Shall we twice a year the economists honest the WTO get together and go through their models in their crystal balls and tell the rest of us how much trade they're expecting in the next couple of years and you know where this is going right. Their latest I forecast out today shows a sharp drop in the growth of trade from where they were expecting just six months ago in April. Thinking was we'd see trade volumes grow two point six percent this year now just one point two percent its backdrop so we asked marketplace's. Tracey Samuelson to figure out what has changed in the past six months this forecast is downgrade from what the WTO was expecting in April and that was a downgrade from what it was expecting last September Coleman knee and economist in the research in statistics division at the WTO says we're already seeing slower trade growth show up in the data. What's happened is the trade growth in the first half of the year of Twenty nineteen was much listen we expected so we were forced to revise our forecast down pretty substantially. He says there is a number of reasons why there's slowing economic growth in major economies uh-huh and regions in Asia and Europe a bit in the US and that reduces demand for it for all kinds of goods including imports. It's lying. Economic growth doesn't totally explain the slowing growth in trade volumes. There's something else what could it be since April. The trade dispute has only escalated. Fan Vino is the US chief economist SNP Global. We've had the United States add more tariffs on now three hundred billion of Chinese products and still more tears to take effect in December. Eastward facade is a trade policy professor at Cornell has been a fundamentally evaluation about what the prospects for dissolving the retention. It's become clear that the US China trade tensions are here to stay so precise says businesses are reevaluating their supply chains and putting investment plans on hold which can ultimately mean less trade. I'm tracey Samuelson for

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