According to the latest report, the Light Traffic Index (LTI) rose 1.3% m/m in October, while the Heavy Traffic Index (HTI) rose 3.0%. Heavy traffic is down 0.1% y/y, while light traffic is down 0.4% y/y. 

Light traffic (motorbikes, cars and vans) is generally a good indicator of the state of demand, as opposed to production. It typically provides a six-month lead on momentum in the economy – variation reflects discretionary spending on outings, movement of couriers and tradespeople etc. The trend in light traffic is flat, matching overall economic activity as measured by GDP, but down in per capita terms (ANZ population forecasts). 

Heavy traffic data (mostly trucks) tends to provide a good steer on production GDP in real time, as it captures both goods production and freight associated with both wholesale and retail trade. The Heavy Traffic Index lifted 3.0% in October   and is flat compared to a year ago (three-month average), while light traffic is 0.4% lower.  

The overall signal regarding economic activity remains soft.