Freight is one of the figures that is an leading economic indicator of economic recovery. With improvement showing in the freight statistics, this bodes well for the US economy.
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US – Yesterday saw the release of the monthly Freight Transportation Services Index (FTSI) figures from the U.S. Department of Transportation's Bureau of Transportation Statistics. The Index provides a good long term insight into the output of logistics services provided by the for-hire freight transportation industries but, as with most statistics, predictions based on them depend on one’s own interpretation of them.
The FTSI is a seasonally adjusted index that measures changes from the monthly average of the base year of 2000. It includes historic data from 1990 to the present and included in the figures are such transportation methods as for-hire trucking, railroad freight services (including rail based intermodal shipments such as shipping containers on flat cars), movements by inland waterways, pipeline transportation and airfreight. The index does not include international or coastal waterborne movements, private trucking, courier services, or the US Postal Service.
Yesterdays report shows a 0.2% rise in traffic during October from its September level, rising for the second consecutive month. The FTSI has risen 5.7 percent over the last 17 months, starting in June 2009, after declining 15.3 percent in the previous 10 months beginning in August 2008 with the Index increasing in 13 of the last 17 months. Overall however the first ten months of this year witnessed a fall of 0.7% after that 2008 crash and although the index rose 3.2 percent from October 2009 to October 2010, it remains below the level of every other October since 2001.
Used in conjunction with other economic indicators and observations the movements of the FTSI can be a useful tool in analysing the relationship of changes in the US transportation output to changes in the country’s Gross Domestic Product (GDP). Release of the November index is scheduled for the 12th January and with numerous factors such as the mid term results and seasonal variations to consider observers will be keen to see if the slight upward trend of the FTSI is sustained.
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