The Ceridian-UCLA Pulse of Commerce Index fell a full percentage point in September on a seasonally and workday adjusted basis. September's decline follows a 1.4% decline in August and a 0.2% decline in July.


With hopes that September data would be positive, last month Ed Leamer, chief economist for the Ceridian-UCLA Pulse of Commerce Index and director of the UCLA Anderson Forecast wrote, "Based on the July and August data, the PCI will likely decline in the third quarter and this suggests GDP growth of zero to 1.0 percent. With the continued weakness in September, the PCI-based forecast for third quarter GDP growth is zero."

Over the past three months, compared to the prior three months, the PCI declined at an annualized rate of 4.3 percent. The rate of decline in the third quarter has been exceeded only in the deep recession of 2008/09, and tied only once outside of recessions, in March 2000.

On a year-over-year basis, the PCI was down 0.2% in September.

The Ceridian-UCLA Pulse of Commerce Index is based on real-time diesel fuel consumption data for over the road trucking and serves as an economic indicator. 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, say the index creators.

This month, the year-over-year change was below last year for the first time since May 2011, or the second time since January 2010. Over the past four months, the year-over-year change has been rapidly declining.

"Businesses appear to be unwilling to restock for a potentially vibrant holiday season at the same time as normal and they are planning to ramp up inventories late this year, if and when the sales start to materialize," explained Leamer.

Due to the continued weakness in the PCI, the index analysts' forecast for September Industrial Production is a 0.55% decline when the government estimate is released Oct, 17.

The complete September report, regional analysis and additional commentary are available at www.ceridianindex.com.