After outpacing overall GDP since bottoming last Fall and through the winter, growth in the trucking sector, although still positive, began to lag broader GDP trends heading into the Summer. While slack conditions remain, freight and trucking activity should respond positively to central bank easing, with two rate cuts already in the books. And with inflation heading in the right (lower) direction and the unemployment rate still on an upswing, BMO economists currently expect the run of consecutive rate cuts to continue through the turn of the year, with the policy rate reduced to 3.5% (from 5% before June) by January, before the easing pace slows during the first half of the year and reaches 3.0% by next June. That said, much of the rate forecast depends on the pace and magnitude that the Federal Reserve follows the BoC's lead.
Industry Update Summer 2024: Canada Truck Transportation
