Transportation news: Pulse of Commerce Index is down

Despite economic indicators—and anecdotal reports—indicating to a large degree that the economy is showing signs of a rebound, the most recent results of the Ceridian-UCLA Pulse of Commerce Index (PCI) indicate the green economic shoots may not be as advertised.

The PCI, according to Ceridian and UCLA, is based on an analysis of real-time diesel fuel consumption data from over-the-road trucking and is tracked by Ceridian, a provider of electronic and stored value card payment services. The PCI data is accumulated by analyzing Ceridian’s electronic card payment data that captures the location and volume of diesel fuel being purchased by trucking companies.

The PCI closely tracks the Federal Reserve’s Industrial Production data as well as GDP growth.

After beginning the year with a 0.6 percent gain, the PCI dipped 0.7 percent in February and was followed by a 1 percent uptick in March. It was down again in April, falling 0.3 percent. The PCI was up 6.5 percent year-over-year, marking the fifth straight month of increases as “better than normal” levels, according to Ceridian and UCLA.

“The latest PCI numbers are disappointing and cast considerable doubt on the strength of the recovery and the strength of GDP numbers for 2010,” said Ed Leamer, the PCI’s chief economist, in a statement. “The next two months will tell if the first quarter’s healthy consumer spending will help lift the PCI and propel stronger GDP growth for the year.”

And while the PCI is showing annual growth, officials said “expectations in the market for a robust recovery may be too optimistic.

Ceridian Vice President and Index Analyst Craig Manson told LM that April’s 0.3 percent decline can be viewed as a disappointment in some respects, in terms of the health of the economy.

“What it means is that economic growth year-to-date is basically flat,” said Manson. “It is important to point out that compared to last year that we are up. But GDP and the PCI sequentially are flat following a strong December to finish 2009.”

While there is still recovery underway, Manson said these sequential tallies temper the optimism of the recovery regarding the outlook for this quarter and throughout the rest of the year.

Factors driving economic patterns are strong consumer spending in recent weeks, which Manson said is likely to drive growth for inventory re-stocking in the coming months. But in conversations with trucking companies, Manson said the overwhelming message is that conditions are good but not great, indicating it will require more time before a full recovery is intact.