The developers of a monthly index that gauges economic activity by tracking truck drivers' fuel purchases said late Tuesday that the index fell in August by 1 percent, a figure they said was disappointing but was not a harbinger of the widely discussed "double-dip" recession.
The Ceridian-UCLA Pulse of Commerce Index (PCI), published by the university's Anderson School of Management, analyzes data from fuel credit cards swiped by drivers as they fill their rigs. The database, created by Ceridian, captures the location and volume of fuel being purchased. Because the information is tracked in real time, UCLA and Ceridian said the index paints an accurate picture of product flow across the United States and, by extension, overall economic activity.
The picture painted for August was not pretty, especially after July's 1.7-percent increase raised hopes of a slow but steady recovery.
"The August data is obviously discouraging after the cautious optimism created from July's report," said Ed Leamer, chief economist for the PCI, in a statement. Leamer said there "is not much to feel good about" in terms of last month's data raising hopes for a stronger recovery and a drop in the unemployment rate, which stands nationwide at 9.6 percent. He added, however, that the August index "remains far from double-dip territory."
Through August, the PCI has grown by 6 percent year over year. Though August represents the ninth consecutive month of growth, the pace of expansion has been declining since June. PCI results need to reach 10 to 15 percent year-over-year growth to signal a healthy job market.
When the July PCI was released, its developers predicted a third-quarter gross domestic product (GDP) growth rate of 4 percent if August and September data came in strong. In the wake of the subpar August results, they now expect third-quarter GDP growth to be between 1.5 and 2.5 percent.
"The restocking of inventory and exceptional growth in imports that were helping drive the transportation of goods and materials appears to be over," said Craig Manson, senior vice president and index expert for Ceridian, in the statement. "We have seen August economic results from the manufacturing sector continuing their positive momentum, but it's too difficult to interpret, at this point, what it means for trucking."