Home Industry Trade Global goods trade continues recovery in Q3 2024: WTO Quarter-on-quarter trade growth averaged 0.7 per cent over the last two quarters, which translates to an annualised rate of 2.7 per cent by Neesha Salian September 6, 2024 Image: WAM Global goods trade continued its recovery in Q3 2024, building on gains earlier in the year after a sluggish 2023, the World Trade Organization (WTO) stated in its latest Goods Trade Barometer report. However, WTO warned that rising geopolitical tensions and other factors pose risks to the trade outlook. According to the report, the volume of world merchandise trade began to pick up in the final quarter of 2023 after stagnating since late 2022, growing 1 per cent quarter-on-quarter in Q1 2024 and 1.4 per cent year-on-year. This growth followed a period of weak demand, driven by high inflation and interest rates across key markets. Read: Global trade sees growth in Q1 2024, shares UNCTAD Quarter-on-quarter growth averaged 0.7 per cent over the last two quarters, which translates to an annualised rate of 2.7 per cent. This closely aligns with the WTO’s April 2024 forecast of a 2.6 per cent increase in global trade volume for the year. However, regional trade patterns have diverged, with weaker-than-expected growth in Europe offset by stronger performance in other regions. The WTO indicated that it may revise its regional forecasts in its next update due in October. The WTO Goods Trade Barometer, which tracks trade trends, showed that most component indices are on or above trend. The barometer’s overall reading suggests steady growth, with the automotive products index at 103.3, container shipping at 104.3, and air freight at 107.1. However, the electronic components index fell below the trend to 95.4, while new export orders (101.2), usually a key predictor, have started to decline. Global trade outlook Despite positive signals, the WTO stressed that the global trade outlook remains clouded by geopolitical instability, regional conflicts, shifting monetary policies in advanced economies, and weakening export orders. The next WTO trade forecast is expected in mid-October, offering further insights into how these challenges could shape global trade in the coming months. In a report published earlier in May, the OECD expects global trade in goods and services to grow by 2.3 per cent this year and 3.3 per cent in 2025 – more than double the 1 per cent growth seen in 2023. The first OECD Economic Outlook in 2024, expects falling inflation will enable central banks to start lowering interest rates, but adds that real rates are likely to remain “above estimated neutral levels”. Meanwhile, the IMF’s latest World Economic Outlook puts world trade growth at 3 per cent and 3.3 per cent for 2024 and 2025, respectively, despite revising down its projections from earlier in the year. Tags global trade outlook Q3 highlights WTO Goods Trade Barometer You might also like UAE central bank adjusts inflation forecast for 2024 GCC consulting market set to cross $6bn this year, shows report Brent oil price likely to be above $80 a barrel by year end, shows Bloomberg survey How geopolitical tensions will complicate WTO deal-making ahead of Abu Dhabi meeting