A monthly index that measures economic activity by tracking truck drivers' fuel purchases rose sharply in December, signaling a strong start to 2011.
The Ceridian-UCLA Pulse of Commerce Index (PCI), which its founders describe as a real-time measure of the flow of goods to U.S. factories, retailers, and consumers, surged 2.4 percent in December, pushing the PCI above its previous 2010 peak, set in May.
The December data, combined with November's 0.4 percent increase, offset three consecutive down months from August through October, declines that led the index's trackers to worry about the sustainability of the economic recovery.
On a year-over-year basis, the PCI increased 4.1 percent in December, which is in line with the November and October year-over-year rises.
The index, published by UCLA's Anderson School of Management, analyzes data from fuel credit cards swiped by drivers as they fill their rigs. The database, created by Ceridian Corp., a human resource, payroll, and benefits specialist, captures and analyzes the location and volume of fuel being purchased. Because the data are tracked in real time, UCLA and Ceridian say, the index paints an accurate picture of product flow across the United States and, by extension, overall economic activity.
Craig Manson, a senior vice president for Ceridian, says the firm was "not wildly surprised, but pleasantly surprised" by the December results. He said most of the December gains were backloaded in the week between Christmas and New Year's, when inventory replenishment activity was stronger than usual.
Manson says the December data indicate that shippers, retailers, and consumers are growing more optimistic about economic prospects. That optimism should give the PCI positive momentum into the first quarter of 2011, he adds. However, Manson cautions that the results do not suggest the economy will grow like gangbusters, as some forecasters have predicted.
The complete December report and additional commentary are available at www.ceridianindex.com.