Air cargo volumes lost momentum towards the end of 2018
The slowdown in freight demand growth in 2018 has been consistent with the typical pattern following inventory restocking cycles in the past. However, the loss of upward momentum in recent months appears to illustrate the increasing headwinds to freight demand from renewed signs of weakness in global economic activity.
These are perhaps most evident in the new export orders component of the global manufacturing Purchasing Managers’ Index (PMI), which has proven to be a reliable leading indicator of industry-wide FTK growth in the past. The series has now fallen in month-on-month terms in 10 of the last 11 months, and has been below the 50-mark (ie, territory normally associated with falling export orders) since September. At current levels, the indicator continues to suggest that annual FTK growth is unlikely to pick up sharply anytime soon.