The trucking environment remains sluggish as choppy freight volumes are held to a stalemate (at best) by a gradual increase in freight-carrying capacity. Welcome freight tailwinds include seasonal consumer spending as fall approaches, cooling inflation, repaired supply chains, a recent uptick in residential construction, and a mid-Summer bounce in commodity prices. Conversely, lackluster merchandise trade flows, softening employment, household credit exposure to multi-decade high interest rates, less aggressive fiscal stimulus, potential labor turmoil in the auto sector, and an ongoing consumer tilt toward services will pose formidable challenges to the freight market for several more quarters. As such, the possibility of policy rate cuts by Spring 2024 may be the next best window for sustained improvements in the freight cycle.
Industry Update Summer 2023: Canada Truck Transportation
