The General Economy Summary: Pertinent to Restaurants, general economic confidence dipped late in ’24, but indications are 2025 will be steady
The Conference Board said Dec. 23 that its consumer confidence index fell back for the month to a lower-than-projected 104.7 from 112.8 in November. • The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—fell 1.2 points to 140.2. • The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—tumbled 12.6 points to 81.1, just above the threshold of 80 that usually signals a recession ahead. December’s fall in confidence was led by consumers over 35 years old; consumers under 35 became more confident. Among income groups, the decline was concentrated in consumers with household earnings between $25K and $100K, while consumers at the bottom and top of the income range reported only limited changes in confidence. Consumers had been feeling increasingly confident in recent months, spending more in the run-up to the all-important holiday shopping season. The consumer confidence index measures both Americans' assessment of current economic conditions and their outlook for the next six months. The proportion of consumers expecting a recession over the next 12 months remained stable. The Conference Board Perhaps driving soured consumer sentiment is that both the US Federal Reserve and Bank of Canada indicated in December they will
be taking a cautious approach to interest rate adjustments in 2025 after making a series of rate cuts in the second half of 2024. US Federal Reserve effective rate stands at 4.33%, Canada’s at 3.25% and both countries’ monetary governance boards remain focused on reducing inflation rates that stubbornly linger several basis points above the shared 2% target level. CBS News, Investopedia, Canadian Mortgage Trends Ground transportation of foodservice supplies across North America are driven largely by the cost of diesel fuel and the good news is that prices at the pump in Canada and the US keep declined through 2024 and are predicted to continue to slide lower in the coming year. Fuel prices, both diesel and gasoline, are of course a fundamental driver of overall general economic health, as well. • Diesel fuel prices in Canada declined throughout 2024 - reaching a 14-month low by September - and prices remained stable through year-end. Forecasts for 2025 shows prices potentially increasing slightly, peaking in late spring or early summer 2025, then trending lower. Average prices per liter are projected to be around CAD 1.50. Kalibrate.com • Similarly in the United States, diesel prices stayed on a downward trend in 2024, averaging USD 3.46 per gallon by December. The U.S. Energy Information Administration (EIA) projects that diesel prices will average $3.61 per gallon in 2025, continuing the downward trend from 2024. InTek Freight Logistics
4
Q1 2025 Market Update
ACR©2025
Made with FlippingBook - professional solution for displaying marketing and sales documents online