The Ceridian-UCLA Pulse of Commerce Index, "based on real-time diesel fuel consumption data for over the road trucking," jumped significantly in March, erasing what was looking like a very soft patch or even the beginnings of a downturn since mid-2010. The softness earlier this year probably reflected the awful weather back East. This index is consistent with moderate growth of about 3%, which is what most people seem to be expecting these days. I'm seeing more growth downgrades than upgrades, but I remain optimistic that the economy is going to be picking up strength as the year progresses. There is no reason for concern here.
Yeah, it seems like air is going out of balloon here and there.
ReplyDeleteSome good news is that diesel demand may be reduced due to higher mpg diesels hitting the road. I don't know if the Ceridian-UCLA folks factor that in.
Bernanke needs to err to the side of growth. Still a lot of feebleness out there, and no one is talking boom times.
"Morgan Stanley's researchers have dropped expected real GDP growth in the first quarter to 1.5%, from 1.9%. And Macroeconomic Advisers also cut their projection to 1.5%, down from 2.1%. In January, Macroeconomic Advisers were anticipating growth of 4.1%. But that was before rising oil prices, disaster in Japan, and austerity fever. Real output growth of 1.5% is not very good, it should go without saying. It's below the trend growth rate, at a time when the economy should be roaring ahead at substantially more than trend growth. America still has a real output gap of about $800 billion, not to mention 13.5m unemployed workers to worry about...."
ReplyDeleteFrom Brad DeLong. He is a big lib, so there is spin, but the numbers are what they are.
Bernanke, please keep the foot on the gas pedal.