US manufacturing output strong in June

The American Trucking Associations’ (ATA) advanced seasonally adjusted Truck Tonnage Index increased 1.2 per cent in June after falling 1.0 per cent in May.

June’s increase was the largest month-to-month gain in 2012. However, the index contracted a total of 2.1 per cent in April and May. Compared with June 2011, the index was 3.2 per cent higher, the smallest year-over-year increase since March 2012. Year-to-date, compared with the same period last year, tonnage was up 3.7 per cent.

The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment,  was 0.9 per cent below the previous month.

For the second quarter, the index was off 0.8 per cent from the previous quarter, which was the first decrease in a year. Compared with the second quarter in 2011, the index was up 3.5 per cent.

“June’s increase was a pleasant surprise, but the lower year-over-year gain fits with an economy that has slowed,” ATA Chief Economist Bob Costello said. “Manufacturing output was strong in June, which helped tonnage levels.”

Costello said he’s still concerned about businesses sitting on cash instead of hiring more workers or spending it on capital, both of which would give the economy and tonnage a shot in the arm, as they are worried about Europe and the U.S. fiscal cliff at the end of the year.  Costello lowered his tonnage outlook for 2012 to the three to 3.5 per cent range due to recent economic weakness.

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