The ANZ Truckometer indexes are showing signs of life and suggests GDP growth has reached its lowest level.
The light traffic index rose from its recent plateau and was up 1.2% month-on-month in November while the heavy traffic index fell 1.5% following two strong monthly increases.
ANZ chief economist Sharon Zollner says the annual growth in both indexes is lifting off lows.
“It suggests annual GDP growth is going to continue to be unimpressive for a while yet. But things are looking better in a momentum sense.”
“The two ANZ Truckometer indexes reflect economic activity. Both indexes agree that the economy has lost considerable momentum, but the data has improved in the past few months, consistent with the lift in ‘soft’ data such as our ANZ Business Outlook survey and the PMI (performance of manufacturing).
“Given the volatility in the indexes it is certainly too soon to say that they have definitively turned the corner. But that said, the recent lift in annual growth in the two indexes is supportive of our view that annual GDP growth is set to bottom out around the current level of 2%.
“To extract a signal for quarterly growth one has to smooth the traffic data quite a bit, which means turning points can take a while to show up. Current growth in the six-month average of the light traffic index is hardly inspiring, but it is at least suggesting positive GDP growth outturns, albeit modest ones, over the next six months,” Zollner says.
