Toll Index September 2014 – keep calm

If you read some of the press reporting (Reuters, Focus) on the German economic cycle lately you’d think that the world is coming to an end. A look at the calendar-adjusted annual spaghetti plot of the German Production Index shows us that the supposedly bad August is at least level wise well within the group of good Augusts in the last 8 years than near the bad crisis Augusts in 2009 and 2010. So if you choose to see the 4.5% drop in August as compared to July (remember that the same press was surprised that July was a record month after all, see our comment) instead of the 1% drop compared to August 2013 you may indeed feel justified playing Kassandra; more so if you choose to forget that the 1% difference between the two Augusts is well within the revision error of such preliminary numbers.

German Production Index

So level-wise, things are not as bad as some may make them out to be and the recent downward revision of the GDP projection of the German government tells us more about the nature of such projections than give us a hint about a downward trend. If you are wondering what September will be like the Toll Index tells us that there is a solid amount of heavy trucks crossing the German borders so yes Germany cannot make it without Europe and yes Geopolitical uncertainty plays a role and we all need to do our homework but the bottom line is that we should be doing so by keeping calm and carrying on. The end of word is still not forecast-able on the basis of data.

Toll Index - Outbound

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