Pulse of Commerce Index: May Gain of 0.8% In a Now Discontinued Index

The latest Ceridian-UCLA Pulse of Commerce Index (PCI), a measure of the economy based on diesel fuel consumption, is now available.

Each month we've looked forward to the publication of the Pulse of Commerce Index. We're sad to announce that today's report was posted with the accompanying message: "Please note that the May 2012 Ceridian-UCLA Pulse of Commerce Index by UCLA Anderson School of Management will be the last report issued."

Two months ago Ceridian and the UCLA Anderson School of Management announced that it "will no longer publish the accompanying monthly data interpretation report. In its place, the report will include a headline regarding the overall direction of the PCI in correlation with Industrial Production and a regional summary, all of which should be familiar from previous monthly PCI reports."

The discontinuation of this index comes as genuine disappointment.

Here is the summary for May.

The Ceridian-UCLA Pulse of Commerce Index® (PCI®), issued today by the UCLA Anderson School of Management and Ceridian Corporation rose 0.8 percent in May. This third straight positive month has turned the three-month moving average around, which is now growing at a rate of 2.2 percent.

Our main interest in the PCI is the three month moving average of the index adjusted for population growth over the timeframe of the index. Our assumption is that diesel fuel demand is highly correlated with the population dependent on its benefits. But first let's see the raw data, with and without seasonal adjustment.

The first chart shows the PCI unadjusted and seasonally adjusted. As we can readily observe, the index had been trending up since end of the Great Recession, but it has yet to achieve the highs of the immediate pre-recession months and now appears stalled or slightly contracting. In fact, we're at approximately the level first achieved in early 2006.

In the chart below the 3-month moving average of the PCI is shown with the dotted blue line. The solid line is the same moving average of the data series adjusted for population growth based on the Bureau of Economic Analysis mid-month population data, which is available from the St. Louis Federal Reserve here. The current level of the population-adjusted metric is equivalent to the level first attained in the February 2004, over eight years ago. The prevailing trend has been lower since the interim high in March 2011. With the latest data, we're 0.9% off the high set 14 months ago.