The Ceridian-UCLA Pulse of Commerce Index rose 1.1% in October after three consecutive months of negative numbers, offsetting the 1% decline in September.


However, the economic experts at UCLA note that that means the three-month moving average is still falling.

Over the past three months, compared to the prior three months, the PCI declined at an annualized rate of 5.8%, and the PCI remains lower than it was during most of the first half of 2011.

"The October data offer some welcome relief from the double-dip fears that were rampant a month ago, but one month does not mean a new trend," said Ed Leamer, chief economist for the Ceridian-UCLA Pulse of Commerce Index and director of the UCLA Anderson Forecast. "Until we get a series of positive months, it remains a she-loves-me, she-loves-me-not economy with bad news followed by good followed by bad."

On a year-over-year basis, the PCI was up 1.3% in October compared to the -0.2% decrease in the prior month. This contrasts with the trend over the prior four months where the year-over-year change in the PCI was rapidly declining.

"Given the weak PCI, the advance estimate of third quarter GDP growth of 2.5 percent was surprising, but the final estimate may be lower," according to Leamer. "The PCI measures inventories in motion, and it is noteworthy that the inventory component of GDP contributed minus 1.1 percent to the overall 2.5 percent growth rate."

Based on the latest PCI data, UCLA's forecast for October Industrial Production is a 0.12% increase when the government estimate is released November 16.