## Commodity Commotion

_IMF Blog, December 21, 2016_

## Source details

**Canonical URL:** [Commodity Commotion](https://www.imf.org/en/blogs/articles/2016/12/21/commodity-commotion)

## Other formats

- [Markdown version](/en/blogs/articles/2016/12/21/commodity-commotion/index.md)
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## Bibliographic details
- Authors: iMFdirect
- Published: December 21, 2016

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### Definition: terms of trade and commodity terms of trade
- Terms of trade is the price of a country’s exports relative to its imports.
- The commodity terms of trade refers to a country’s commodity exports relative to its commodity imports.

### Impact in 2015
- Commodity-exporting economies: terms of trade dropped by an average of about 10 percent of GDP in 2015.
- Commodity-importing economies: experienced about a 2 percent of GDP benefit from the 2015 drop in prices.

### Developments in 2016 versus spring 2016 World Economic Outlook projections
- Spring 2016 WEO projection: another 2 percent decrease in the terms of trade for commodity-exporting countries in 2016.
- Actual IMF estimate for 2016 (commodity-exporting countries): decline on average is estimated to have been closer to ½ percent of GDP.
  - Note: this smaller decline does not do much to help recuperate the losses suffered in 2015.
- Commodity-importing countries: the IMF estimates the benefit to these economies to have increased by less than ¼ percent in 2016.
  - This increase is less than half the projected ½ percent anticipated in the spring 2016 World Economic Outlook projections.

*Source: Commodity Commotion, iMFdirect, December 21, 2016*

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## References

- [World Economic Outlook](http://www.imf.org/external/pubs/ft/weo/2016/01/)

_Source: https://www.imf.org/en/blogs/articles/2016/12/21/commodity-commotion_