Trucking activity has improved since last fall, with sector GDP growth keeping pace with overall GDP, while spot freight volumes in March were 35% higher than the cycle low point last July, although still more than 20% lower than a year earlier. Nonetheless, any lasting resolution to the freight recession will largely hinge on the timing and pace of any central bank policy rate easing cycle. With inflation heading in the right (lower) direction and rising unemployment, expectations are coalescing around an initial BoC rate cut, possibly by June, if not July. While that will be a welcome start for borrowers of all types, what happens after that will largely depend on how fast (or not) the Federal Reserve follows suit, where the BoC will surely not want to step too far out ahead of the Fed for fear of weakening the currency and re-igniting inflation.


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