Pulse of Commerce Index Falls 0.7% in February

The U.S. economy was essentially flat for the first two months of the year, with a February decline offsetting the modest gain in January, according to the latest Ceridian-UCLA Pulse of Commerce Index. February fell 0.7 percent, following January's increase of 0.6 percent. This flat performance follows a robust 2.8 percent gain in December.

With the new February PCI data, the Federal Reserve's Industrial Production forecast drops to 0.6 percent.

The PCI is based on an analysis of real-time diesel fuel consumption data from over the road trucking tracked by Ceridian Corp., a global provider of electronic and stored value card payment services and human resources solutions. The February release was enhanced from January's release to adjust for monthly workdays, creating less volatile month to month changes in the index.

"February was disappointing, but the geographic pattern underlying the index suggests this was due in large part to extreme snowfalls during the month," said Edward Leamer, director of the UCLA Anderson Forecast and chief economist for the PCI. "As we indicated with the release of our January report, we still need much stronger growth in the PCI to get Americans back to work. To sustain at least a 4 percent GDP number for the first quarter, the March PCI has to be significantly stronger at over 1 percent growth. That number will be very important. It will reveal where the economy is headed and whether March truly is a catch-up month after a snowy February."

The Ceridian-UCLA Pulse of Commerce Index also provides data for the nine Census regions. Not surprisingly, the areas most hit by heavy snowfall – the East North Central and Mid Atlantic regions – experienced declines of 4.1 percent and 2.5 percent, respectively. The PCI grew in three regions, up 2.7 percent in the West North Central region, 2.1 percent in the Pacific region, and 2.6 percent in the West South Central region. East-West traffic in the Mountain region was down 0.8 percent.

The index is built by analyzing Ceridian's electronic card payment data that captures the location and volume of diesel fuel being purchased by over the road trucking operations, providing a detailed picture of the movement of products across the United States.

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