The Light Traffic Index (LTI) rose 0.2% in October and is 3.2% higher than a year ago, with annual growth increasing rapidly. The more volatile Heavy Traffic Index (HTI) eased 0.2% in the month, but is still up 0.6% y/y.

Light traffic (motorbikes, cars and vans) is generally a good indicator of the state of demand, as opposed to production. It typically provides up to a six-month lead on momentum in the economy, with variation reflecting discretionary spending on outings, movement of couriers and tradespeople etc. The trend in light traffic has lifted in the last few months. In per capita terms (using ANZ population forecasts), light traffic has also turned higher.

Heavy traffic data (mostly trucks, but also buses) tends to provide a steer on production GDP in real time, as it captures both goods production and freight associated with both wholesale and retail trade, as well as exports. The HTI has been fairly flat lately, highlighting that we are very early in the economic recovery.

Note all data are seasonally adjusted.