The World Trade Organization (WTO) has raised its 2026 forecast for global merchandise trade volume growth to 3.9%, up from 1.9% in its March baseline, as a surge in AI-related goods offsets disruption from the Middle East conflict. The upgrade was reported by Reuters from Geneva on 8 October 2026.
For 2027, the WTO now expects merchandise trade volume to grow 4.1%, compared with 2.6% previously. That is slightly below the 4.2% growth recorded in 2025.
What Is Driving the WTO Trade Forecast Upgrade?
AI-enabling goods accounted for 47% of global merchandise trade growth in value terms in the first half of 2026. Trade in semiconductors and AI data-centre products rose 67% year on year, although the report notes this trade is highly concentrated geographically. In the first half of 2026, merchandise trade volume grew 3.5% year on year while trade value rose 15%.
Why Was Services Trade Forecast Cut?
Commercial services trade growth for 2026 was cut to 3.3% from a 4.8% baseline, mainly because of higher aviation fuel costs linked to the Middle East conflict. Transport and travel services are forecast to grow just 0.9% and 0.2% respectively in 2026. The WTO expects services trade to rebound to 6.4% in 2027.
How Badly Is the Middle East Affected?
The WTO expects the region’s output to fall 4% in 2026, with imports projected to drop 15.4% and exports 17.2%. Risks flagged include disruption to the Strait of Hormuz and higher fuel and fertiliser costs. World GDP is forecast to grow 2.6% in 2026, with Asia leading at 4.3%.
Market and Trade Reaction
The WTO forecasts Asia’s 2026 imports to rise 9.5% and exports 9.9%, while North America’s imports are forecast to grow 1.4% and exports 5.7%. The report also notes that US imports from China fell 29% in 2025, and China’s share of US imports dropped to 9.3% from over 20% before 2018. No India-specific forecast figures were found in the source we reviewed, and no market reaction was reported.
What Happens Next?
The key variables to watch are whether the AI-goods trade boom broadens beyond a few economies, whether Gulf shipping and the Strait of Hormuz stay open, and how fuel and fertiliser costs evolve. For Indian exporters and importers, higher freight and energy costs remain the main transmission channel.
Frequently Asked Questions
What is the WTO’s new forecast for 2026 trade growth?
The WTO projects world merchandise trade volume to grow 3.9% in 2026, up from the 1.9% it forecast in March.
Why did the WTO raise its forecast?
Mainly because of strong trade in AI-related goods, which made up 47% of global merchandise trade growth by value in the first half of 2026.
What is the outlook for services trade?
Services trade growth for 2026 was cut to 3.3% from 4.8%, largely due to higher aviation fuel costs, but it is expected to recover to 6.4% in 2027.
Source: Reuters report from Geneva, 8 October 2026, on the WTO Global Trade Outlook and Statistics update.
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