The ANZ Truckometer heavy traffic index fell 3.5% month-on-month in September while the light traffic index fell 1.3% m/m.
The drops followed decent lifts the previous month and light traffic maintains its “mild upward trend”, ANZ chief economist Sharon Zollner says.
“Given current strong growth in the population via immigration, an upward trend is to be expected. However, the data remains considerably more volatile than pre-COVID.
“The light traffic index successfully picked that Q2 GDP wasn’t going to be weak, and rightly or wrongly it’s suggesting Q3 may have some life in it as well,” Zollner says.
Heavy traffic data (mostly trucks) tends to provide a good steer on production GDP, but it has been volatile recently.
The three-month average in heavy traffic is sending a weaker signal for Q3 than the light traffic is.
“The data reflects that the New Zealand economy is patchy as the cost of living and tighter monetary policy bites. But it’s not capitulating,” Zollner says.
“Tourism is rebounding, and the housing market is getting a second wind.
“Fiscal policy is stimulatory and population growth is strong. Even in the under-pressure agriculture sector there has been some good news, with dairy prices rising in the last four GlobalDairyTrade auctions.
“It remains unclear whether this overall gentle economic slowdown is going to get more severe – and if not, whether it will be enough to bring inflation sustainably down to target,” Zollner says.
