The economy may be losing momentum but ANZ’s Truckometer says it still has plenty of fuel in the tank.
The Truckometer measures freight traffic in the heavy and light categories as an economic indicator.
The Heavy Traffic Index fell a seasonally adjusted 1.5% in June from the previous month, while annual growth recovered over the second quarter. This was on the back of two solid monthly rises.
By contrast, the Light Traffic Index lifted 0.7% month-on-month but annual growth remained soft, suggesting the economy is navigating some headwinds.
ANZ economists Miles Workman and Liz Kendall say the six-month average in the heavy index shows it has come through a soft patch during the first few months of 2018.
“With recent data flow coming in a little soft around the edges, resilience in the Heavy Traffic Index provides some reassurance that the economic growth engine isn’t about to run out of fuel just yet,” they say.
“Annual growth in the index (on a three-month average basis) continued to recover from April’s post-November 2015 low of 2.9%, running at 6.8% in June.
“This is consistent with GDP growth holding up around trend (about 3%) in the near term. However, other recent data flow suggests activity is travelling at a slightly slower pace than this.”
Growth in light traffic is tracking sideways and is less of an indicator of GDP output.
“Therefore, we’re not putting too much weight on the recent quarterly uptick. Instead, we’ll continue to consider it alongside the broader data flow, which has turned decidedly patchier of late,” the economists add.
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