"The Ceridian-UCLA Pulse of Commerce Index
(PCI), a real-time measure of the flow of goods to U.S. factories, retailers and consumers, rose 2.7% on a seasonally and workday adjusted basis in March, more than offsetting the 0.3% decline in January and the 1.5% decline in February. On a quarter over quarter basis, the PCI is up 3.9% at an annualized rate, a welcome acceleration from the relatively weak growth of the PCI experienced in the second half of 2010.
“The PCI growth of 3.9% for the first quarter of 2011 is a middle-of the-road number, signaling that we are not in either one of the extremes. In other words, the recession is over, but we are not yet experiencing a robust recovery,” said Ed Leamer, chief PCI economist and director of the UCLA Anderson Forecast. “This means that for the coming quarter, the PCI is expecting GDP growth close to historically normal levels of around 3% and normal increases in payroll jobs at approximately 150,000 per month. The unemployment rate is likely to hold stubbornly to its current level but could be driven down by discouraged workers dropping out of the labor force.”
“We are more optimistic than last month, but are still targeting GDP growth of 3% for the first quarter of 2011, which remains at the low end of the range of expectations,” continued Leamer. “The outlook remains consistent with the PCI’s view of the fundamental health of the US economy over the past four months.”
Background: The PCI is based on real-time diesel fuel consumption data for over the road trucking and serves as an indicator of the state and possible future direction of the U.S. economy. By tracking the volume and location of fuel being purchased, the index closely monitors the over the road movement of raw materials, goods-in-process and finished goods to U.S. factories, retailers and consumers."
MP: The PCI in March was the highest since June 2008, more than two and-a-half years ago, and is another sign that a V-shaped economic recovery is underway. In another sign today of increased deliveries of raw materials and finished goods was a story about a new shortage of rail cars titled "Rail Woes Hit Auto Deliveries" in the WSJ, which reported that:
"As the U.S. economy contracted during the recession, railroad operators put hundreds of thousands of rail cars into storage and cut their staffs. Now that shipments of autos, coal and consumer goods are rising again, the nation's railroads don't have enough rolling stock for fast deliveries. The industry, which ran at slower speeds in the first quarter due to heavy snow storms, also was caught off guard by the quarter's 11.4% surge in automotive railcar demand as auto makers ramped up production. The shortage of freight cars has added anywhere from a few days to a few weeks to the time it takes for new cars to reach dealers, forcing auto makers to park finished vehicles near plants around the country."