Recent data from Tradeshift reveals a surprising rebound in global trade activity during the fourth quarter, with a notable increase in order volumes. Tradeshift’s Index of Global Trade Health indicates a modest improvement in global trade transaction volumes, reaching 4 points below the baseline in Q4, compared to a decline of 6 points in the previous quarter.

The analysis of purchase orders and invoices on Tradeshift’s platform shows a remarkable upswing in ordering activity during Q4. Order volumes grew 5 points above the expected range, marking a significant acceleration after tracking below expected levels for the past nine quarters.

In the United States, total transaction volumes stabilized at 3 points below the baseline in Q4, with a noteworthy increase in orders, rising 6 points above the expected range. This surge in orders represents the most substantial acceleration in two years.

Transaction volumes across the Eurozone, which had fallen to 9 points below the anticipated level in the previous quarter, rose to 4 points below the expected level in Q3. Order volumes across the region tracked 3 points above the baseline in Q4. However, UK trade activity remained low compared to other markets, with total transactions 5 points below the expected level, while order volumes grew 1 point above the expected range in Q4.

Tradeshift CEO James Stirk notes that ordering patterns provide valuable insights into businesses’ perceptions of demand signals for the next six months. The data suggests that if order volumes continue to rise in Q1, various sectors, such as transport and logistics, may experience an increase in activity.

Despite the rise in orders, demand for freight capacity remained 6 points below the baseline in Q4, indicating that the overall pattern of decline observed in the past eighteen months has not yet been significantly altered. Transactions across manufacturing remained consistent with the previous quarter, ending the year 6 points below the anticipated level.

While China saw modest signs of improvement from a mid-year slump, trade activity remained in contraction territory. Transaction volumes across local supply chains in China grew at 5 points below the baseline in Q4, compared to a 6-point deficit in the previous quarter.

Stirk emphasizes that the prolonged slowdown in orders requires substantial recovery before demand normalizes, and while sentiment among businesses is improving, the outlook for 2024 remains uncertain.