According to the latest report from the World Trade Organization, global trade is expected to fall between 13% and 32% in 2020.

The coronavirus pandemic has uprooted global trade and depressed demand. According to the World Trade Organization, a major drop in global trade is to be expected.

Global Trade Projected to Plummet

With global demand dropping due to the coronavirus pandemic, the World Trade Organization is slashing expectations for world trade. According to the latest report, “world trade is expected to fall by between 13% and 32% in 2020.”

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According to the report, the immediate goal is to bring the pandemic under control. However, “these numbers are ugly – there is no getting around that,” the report reads.

The report also stresses that today’s economic crisis is not comparable to the Great Recession of 2008. During the past recession, governments intervened with monetary and fiscal policy to remedy the economic crisis. However, this time, restrictions on transport, labor, and travel are affecting the world economy far differently. Therefore, forecasting how the world economy will fare in 2021 or 2022 remains difficult.

A Deflationary Shock?

Analysts have been arguing that the world economy may see a deflationary shock as a result of depressed demand. Due to mass layoffs, everyday people simply do not have the spending power they once had, which will depress revenues and ultimately prices.

The Fed’s endless money-printing has caused many in the cryptocurrency space to argue that we could see a hyperinflationary crisis, but this does not seem to be in the short-term forecast. However, there is some evidence to suggest credit is drying up as businesses take up loans in record numbers. Despite the Fed printing some $60 million in new currency every minute, the immediate fears now are deflationary—although this may just be kicking the can down the road for a later inflationary crisis.

Bitcoin’s main selling point is that it is a hedge against inflation and fiat currency. However, since we are currently amid an extremely deflationary period, Bitcoin’s short-term future seems uncertain. Many traders are now looking at macroeconomic trends to gauge where Bitcoin is headed, despite its much-anticipated halving event set to take place in Mid-May.