Global goods trade continued its recovery in the third quarter of 2024, according to the latest World Trade Organization (WTO) Goods Trade Barometer report. This marks a rebound from the sluggish performance seen in 2023, with quarter-on-quarter trade growth averaging 0.7% over the last two quarters, translating to an annualized growth rate of 2.7%. This aligns closely with the WTO’s earlier forecast of a 2.6% increase in trade volume for the year.

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The WTO noted that trade growth started to pick up in late 2023, gaining momentum in the first half of 2024, with a 1% increase in Q1 and a 1.4% rise year-on-year. This recovery followed a period of weak demand caused by high inflation and elevated interest rates in key markets.

However, the report highlighted that trade growth has been uneven across regions. Europe’s performance lagged behind expectations, while other regions showed stronger-than-expected results. The WTO may revise its regional trade forecasts in an upcoming report expected in October.

The Goods Trade Barometer indicated that most key trade components are trending positively. Indices for automotive products (103.3), container shipping (104.3), and air freight (107.1) all surpassed trend levels. However, electronic components fell below trend to 95.4, and new export orders, a reliable trade predictor, have started to decline, sitting at 101.2.

While the recovery in global trade is promising, the WTO warned that geopolitical tensions, regional conflicts, and shifting monetary policies pose risks to the outlook. Export orders have also weakened, adding to uncertainties.

The next WTO forecast, expected in mid-October, will offer more clarity on how these risks could affect trade for the remainder of the year. The OECD and IMF have projected global trade growth of around 2.3% to 3.3% for 2024 and 2025, driven by expectations of easing inflation and lower interest rates in advanced economies. However, both organizations acknowledge that challenges remain, with real interest rates likely to stay above neutral levels for the near term.