A market slowdown and a lot of global freight activity has prompted some very slow growth rates this year. This comes directly from a fund economist and an outlook like this really does suggest that the US dollar is going to remain supported even against its competitors as the flow of assets stay low. Of course, without a trade, it is very hard for the economy in general to grow and this comes from Maire Owens Thomsen. She is the chief economist at Indosuez Wealth Management. The slowdown in shipping and even air freight for the first quarter really is a warning sign for the trajectory this year. The growth rate has halved this year and it is said to be even worse next year as well. One big reason for this is because the rise over the recent weeks has been really outsized by US growth. This is especially the case when compared to the RoW. If this continues then it doesn’t seem likely that things will continue along the USD narrative.
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For the short-term over the next one or two months, the dollar will go up on the back of the economy and this is certainly showing signs of acceleration. On top of this, there are a ton of other markets and this includes Europe, Japan and more. Global shipping prices tend to be measured by the BDI and this monitors any changes in the cost of transportation and even raw materials as well. As of right now, the BDI has fallen in the first quarter and this is especially the case when you compare it to the fourth.
Since all of this happened, April really has shown a strong recovery and this is especially the case when you look at air freight prices. This is in a rising demand and this has helped to offset some of the dire predictions. The rates have always picked up in April when compared to other months and this is especially the case when you look at the trade protectionism when compared to the US.
On top of this, there is a worrying lack of respect for the international institutions and this has been put into place after the second world war. This has also been seen as being a negative development for the geopolitical outlook when compared. The Trump administration is going to be attacking the trade in a way that is completely unilateral and this is exactly what happened in the 1920s. Years of global trade wars may have been over-egged and a lot of people think that the chances of this happening are in fact, very, very low. Trump is the only person in the whole administration who wants a war and this is according to an economist. Only time will tell if this whole thing is going to blow over.