The ANZ Truckometer says a 2% fall in the light traffic index in October isn’t necessarily a bad thing if New Zealand is to avoid a boom/bust economic cycle.
The ANZ heavy traffic index eased 0.2% in October, though the smoothed 3-month average remains positive, lifting 1.4%. The index continues to trend upward but at a slower rate than earlier in the year.
The ANZ light traffic index fell 2.0% in the month (3-month average: -0.3%).
“It certainly deserves a breather after a phenomenal run, but it’s worth noting this is the largest monthly fall since mid-2012,” says the bank.
“It is notable that the heavy traffic index is trucking along, but the light traffic index, which leads the economy by six months, had a broad-based fall,” says the ANZ.
“Given the speed limits currently imposed on the New Zealand economy, most obviously in the forms of difficulty finding labour and tightening the availability of credit, it would not be at all surprising to see growth moderate over the next six months,” says the bank.
“This wouldn’t necessarily be a bad thing. In fact, it’s desirable to avoid a boom/bust cycle,” says the ANZ.
