QUICK QUILL — March’s Global Supply Chain Volatility Index reflected the most excess capacity since the COVID-19 pandemic. Real C&I loan volume channeled the global narrative, with a December topping in upstream chemical rail traffic flagging a cooling in downstream U.S. industrial activity. The precipitous falloff in Canadian consumer confidence, tracking a rollover in Bloomberg’s commodity index, echoed the theme. While Asian supply chains bucked the trend, validated by a boost in incoming U.S. container traffic, that is not likely to last.
TAKEAWAYS
- The GEP Global Supply Chain Volatility Index declined for a third straight month in March to -0.51, a near five-year low; driving the slowdown was a decline in stockpiling behavior to levels not seen since July 2016 as well as ebbing demand, particularly in North America
- Real C&I loan growth rolled over to -2.6% on a 6MA basis in March, validating the GSCVI’s lack of inventory building; while chemicals rail carloads in the U.S. peaked in December, incoming intermodal containers rose through Q1 thanks to strength from Asia
- Nanos’s Consumer Confidence gauge for Canada fell to 45.9 in the second week of April, the lowest level since February 2023; given the country is a major commodities player, the reversal in commodities prices will continue to be a drag on Canadian household sentiment