September 2010 continued the negative trend for the Ceridian – UCLA Pulse of Commerce Index by falling the second month in a row. This index is created by UCLA Anderson School of Management tries to anticipate GDP and Industrial Production.
This index is based on Ceridan’s diesel distribution in the USA. Diesel is the fuel of America’s logistics. If less freight is being moved, then the economy would be moving slower. Of course, freight movements are seasonal so the data must be compared year-over-year.
Econintersect does not use the data from the index itself – but uses the background fuel consumption directly for analysis.
Analysis is complicated by the recession and the new normal. Here, if we use pre-2008 data – fuel consumption is down MoM between August and September. However, Econintersect believes a new normal has occurred – and only 2008 and 2009 data can be used as we now have new seasonal characteristics.
The table below compares July/August / September 2010 data with 2005 through 2009 data. It suggests approximately a 2.5% drop in fuel consumption MoM, yet the fuel consumption is definitely up YoY.
This data continues to support the Econintersect’s zero / low growth forecast, as opposed to rail freight which is consistent with more growth. At this point the data is only less good YoY, and one month of data is not a trend. The background data in this index is fairly noisy.