G20 merchandise trade growth slowed markedly in value terms in Q2 2022, as measured in current US dollars. Exports and imports increased by 2.1% and 2.6%, respectively, as compared to 4.8% and 6.2% in the previous quarter. While high commodity prices, exacerbated by the war in Ukraine, continued to fuel merchandise trade growth in nominal terms, the slowing growth in value terms partly reflects the increasing value of the US dollar against other major currencies. Rising energy prices boosted merchandise trade in North America in Q2 2022, with exports increasing by 10.2% in the United States and by 11.0% in Canada. In the European Union (EU 27), merchandise exports recorded modest growth (up 0.3%), while imports grew faster (up 3.0%), largely driven by energy. Merchandise exports contracted in East Asia, as confinement measures continued to disrupt economic activity in the region and inflationary pressures weighed on overseas demand for goods. Exports fell by 4.9% in Japan, 0.4% in China and 2.2% in Korea. High prices continued to drive the value of exports for the leading commodity traders in the G20, with exports expanding in Australia (up 12.5%), Indonesia (up 12.7%) and India (up 7.1%).

G20 services trade growth slowed in Q2 2022, as measured in current US dollars. Exports and imports are estimated to grow by 1.1% and 2.2%, as compared to the slightly higher rates recorded in Q1 2022 (2.1% and 2.3%, respectively). Strong travel and transport supported growth across many G20 economies, while prolonged COVID-19 containment measures weighed on services trade in East Asia. Services trade in North America expanded markedly in Q2 2022, largely driven by a strong rebound in travel. Conversely, services trade slowed in Europe. Exports contracted by 2.7% in Germany, reflecting a decline in intellectual, financial and business services, while imports rose by 4.6% boosted by travel. France recorded a modest increase in exports (up 1.8%) due to transport and travel, whereas imports contracted by 1.2%. Across East Asia, services trade showed a mixed picture, with growth in travel and transport being partially offset by weak trade in other services. For the first time since Q1 2020, China reported a decline in services exports and imports (down by 8.1% and 3.3%, respectively).