The ANZ Truckometer light traffic index lifted 1.9% month-on-month in September, while heavy traffic was down 3.3% after jumping strongly the previous month.
ANZ senior economist Miles Workman says traffic data has been very volatile in recent times as COVID impacts and supply-side disruptions and shortages mean observed activity is not all about the level of demand.
“Truck movements have recently likely reflected labour shortages as well as COVID waves coming through.
“Variation in light traffic (motorbikes, cars and vans) is generally a good indicator of consumers’ willingness to spend, as opposed to production. Light traffic is currently surging.
“Demand has so far proven relatively resilient to uncertainty, rising interest rates and falling house prices. While retail activity is definitely down, it hasn’t fallen off a cliff.
“The RBNZ noted last week when raising the OCR another 50bp that they would have expected a more marked slowdown in demand by now.
“The heavy traffic Index tends to provide a better steer on production GDP. We now have a full quarter for the heavy traffic index. This lifted 1.6% over the quarter and suggests the economy continued to expand at a solid pace, pointing to some upside risk to our Q3 GDP forecast of 0.4% q/q.
“But just like the traffic data, the GDP data has its fair share of COVID-related volatility, making the predictability value in indicators such as heave traffic just that little more uncertain,” Workman says.
