The Light Traffic Index (LTI) fell 1.3% m/m in April, while the Heavy Traffic Index (HTI) rose 0.3% m/m after falling the previous month. Unusually, the trend in heavy traffic has been steadier than GDP data over the last couple of years. Unlike per capita GDP, it looks nothing like 2008.

Light traffic (motorbikes, cars and vans) is generally a good indicator of the state of demand, as opposed to production. In the absence of sudden shocks, the light traffic data provides a 6-month lead on momentum in the economy – variation in it reflects discretionary spending on outings, movement in courier and tradespeople, etc. 

The trend in light traffic remains only very mildly upward sloping despite strong population growth of around 3%, but the decline in per capita terms (using ANZ population forecasts) is stabilising.

Heavy traffic data (mostly trucks) tends to provide a good steer on production GDP in real time, as it captures both goods production (including agriculture) and freight associated with both wholesale and retail trade. It suggests positive GDP growth in Q1. The heavy traffic index is 3.3% higher than a year ago (using a 3-month average to smooth out volatility), while light traffic is up 2.2%.