The Recent Uptick In Global Trade Won’t Last: The Kiplinger Letter

Global trade continues to fall as economic growth around the world cools.

To help you understand what is going on in trade globally, and what we expect to happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest…

The recent uptick in global trade won’t last long. World goods trade rose 0.4% in August from July, adjusted for inflation. Trade has barely budged since February and it’s now 4.4% below its peak in September 2022. The new-export-orders component of the global manufacturing purchasing managers’ index (PMI) remained below 50 in September. This suggests that worldwide demand for exports is weak and still contracting.

Trade will continue to fall as economic growth around the world cools. Several advanced economies will likely fall into a mild recession or at least a stretch of very weak GDP growth later this year, which will weigh on demand for traded goods. With a lot of the hit from higher interest rates still to come, demand for goods, particularly high-value goods such as autos and furniture, should weaken, given that spending on such items tends to be more sensitive to interest rates.

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Rodrigo Sermeño
, The Kiplinger Letter

Rodrigo Sermeño covers the financial services, housing, small business, and cryptocurrency industries for The Kiplinger Letter. Before joining Kiplinger in 2014, he worked for several think tanks and non-profit organizations in Washington, D.C., including the New America Foundation, the Streit Council, and the Arca Foundation. Rodrigo graduated from George Mason University with a bachelor's degree in international affairs. He also holds a master's in public policy from George Mason University's Schar School of Policy and Government.