The ANZ Truckometer indexes fell in the month of June but both light and heavy traffic was up over the quarter period.
Heavy traffic was down 4.5% month-on-month and light traffic fell 1.9% month-on-month.
“Looking through the monthly noise it appears annual growth in light traffic flows may be finding a floor, consistent with our expectation that economic growth is due to bottom out shortly,” ANZ senior economist Miles Workman says.
“The heavy traffic index has had a remarkably good run at picking quarterly GDP growth over the past three years, if it continues its most recent stellar run of predictions, it’s boding well for Q2 GDP growth.
“The light traffic index gives a six-month lead on the direction of the economy. It has also had a good run at predicting quarterly GDP growth over the past year or so. But since it is pointing to very weak growth in Q2, due to weak light traffic in the last three months of last year, one of the two indexes must be about to break its winning streak.
“Annual growth in the light traffic index has stabilised, consistent with our expectation that annual GDP growth will soon stop declining.
“However, we are picking the economy to recover less aggressively than predicted by both the Reserve Bank and Treasury. With inflation still under par we are therefore expecting two further cuts in the Official Cash Rate this year,” Workman says.
