Traffic index signals growing economy

Its heavy traffic index reflects truck movements on roads selected because historically they are strongly correlated with economic activity at the time. Photo / Getty Images

ANZ's Truckometer is pointing to an economy hitting top gear.

Its heavy traffic index reflects truck movements on roads selected because historically they are strongly correlated with economic activity at the time.

It rose 0.3 per cent last month on top of a very good string of readings in the September quarter.

"Indeed the September quarter saw the strongest quarter increase in the history of the series [since 2002]," said ANZ economist Sharon Zollner.

"This would certainly tie in with anecdotes of a very strong primary sector bounceback from drought, thanks to a mild winter and good early spring rains."

The upward trend in the heavy traffic index was steep, Zollner said, and corroborated earlier bullish production of the light traffic index, which tracks cars and vans and provides a steer on gross domestic product six months ahead.

Last month the light traffic index jumped 1.8 per cent. "This is a welcome result after a couple of months of small falls which were suggesting the upward trend in the light traffic index was at risk of running out of steam."

The index predicts solid GDP growth for the rest of the year, averaging a robust annual pace of 3.5 per cent, she said.

"A strong bounce-back in primary sector production is the primary driver, but the Canterbury rebuild and the housing market are providing important impetus as well," Zollner said.