GENEVA, Sept. 27 (Xinhua) -- The World Trade Organization (WTO) on Thursday revised downward its forecast for global merchandise trade growth both in 2018 and 2019, citing escalating trade tensions and tighter credit market conditions in important markets.

The WTO adjusted its forecast for the 2018 world trade volume growth to 3.9 percent, lower than 4.4 percent previously forecast in April.

Meanwhile, it also downgraded its outlook for 2019 to 3.7 percent from its previous forecast of 4.0 percent.

The WTO estimated that trade will continue to expand but at a more moderate pace than previously forecast.

WTO Director-General Roberto Azevedo noted that while trade growth remains strong, the downgrade reflects the heightened tensions between major trading partners.

"More than ever, it is critical for governments to work through their differences and show restraint," he underlined.

However, the WTO said that trade policy measures are far from the only risk to the forecast, adding that monetary policy tightening in developed economies has also contributed to volatility in exchange rates and may continue to do so in the coming months.

The WTO warned that developing and emerging economies could experience capital outflows and financial contagion as developed countries raise interest rates, with negative consequences for trade.

According to WTO statistics, in the first half of 2018, world merchandise trade was up 3.8 percent compared to the same period in the previous year. Exports of developed economies rose 3.5 percent during the same period while shipments from developing economies increased by 3.6 percent. On the import side, developed economies recorded year-on-year growth of 3.5 percent in the first half of 2018 while developing countries registered an increase of 4.9 percent.

In terms of regional differences, North America recorded the fastest export growth and Asia had the strongest import growth in the first half of 2018.