According to the latest ‘Truckometer’, the Light Traffic Index (LTI) lifted 1.5% month on month in July, while the Heavy Traffic Index (HTI) recovered much of its June fall, rising 6.1%. 

Light traffic (motorbikes, cars and vans) is generally a good indicator of the state of demand, as opposed to production. It typically provides a 6-month lead on momentum in the economy – variation in it reflects discretionary spending on outings, movement of couriers and tradespeople etc. The trend in light traffic remains flat, matching overall economic activity as measured by GDP, but the trend remains firmly downward in per capita terms (using 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 bounced 6.1% in July after an exceptionally sharp fall in June. Heavy traffic is 2.5% lower than a year ago (three-month average), while light traffic is 0.1% lower.  

The overall signal regarding economic activity remains weak, but the rebound suggests some of the dramatic fall in June was likely due to short-term factors like weather or roadworks. Note that all data is seasonally adjusted. In raw terms, truck traffic remains very low.