A monthly index that gauges economic activity by tracking truck drivers' fuel purchases fell in October, marking the third consecutive monthly decline and signaling possible weakness for the holiday buying season.
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 and analyzes the location and volume of fuel being purchased. Because the data 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 index declined 0.6 percent after a 0.5 percent drop in September and a 1.0 percent decline in August. This is the first time the index has declined three months in a row since the trough of the recession in the winter of 2009.
The October decline, coming in what is typically a strong month for U.S. trucking, foretells trouble for holiday shopping activity as wary retailers scale back on orders, the report's authors said.
Craig Manson, a senior vice president for Ceridian, noted that the October results, though discouraging, still mark the 11th straight month of year-over-year growth in the index. "This means that the holiday sales season will likely be better than last year, but potentially disappointing versus current expectations in the marketplace," he said in a statement.
At the same time, however, a survey of chief marketing officers at leading U.S. retailers by accounting and consulting firm BDO showed they expect overall holiday sales to rise 3.50 percent this year, up from a 2.68 percent rise in 2009.
The respondents said they have increased their inventory purchases by 2.8 percent leading into the holidays, with more than one-third saying their inventory purchases have "measurably increased" since last year.