The trading session for the Dow Jones Industrial Average (DJIA) began positively on Tuesday. This increase followed the World Trade Organization’s (WTO) revision of its global trade growth forecast for 2025.
WTO Raises Global Trade Growth Forecast
The WTO has revised its 2025 global trade growth forecast to 2.4%. This is a significant increase from the previous estimate of 0.9% made in April. The organization attributes this revision to a strong performance in the first half of 2025.
Growth Drivers in 2025
- Global trade showed a remarkable growth rate of 4.9% in the first half of 2025.
- Emerging markets have played a crucial role in this growth.
- There is heightened demand for artificial intelligence (AI)-related products.
- Businesses have accelerated their purchases in anticipation of upcoming tariffs.
Projected Slowdown in 2026
Despite the positive outlook for 2025, the WTO anticipates a stark slowdown in trade growth for 2026. The forecast has dropped to just 0.5%, a significant decrease from the earlier estimate of 1.8%.
Factors Influencing Trade Growth
The WTO highlights several factors that may contribute to this slowdown:
- The global economy is expected to cool down.
- The full impact of higher tariffs may become noticeable.
- Policy uncertainty and slower employment growth could pose challenges.
- Trade-restrictive measures are anticipated to hinder growth as well.
In conclusion, while the WTO’s revised forecast provides a boost to market sentiment in the short term, caution is warranted regarding the potential challenges looming for global trade in 2026.
