Why Did the National LoDI Index Crash in September (University of Louisville National Logistics and Distribution Institute Index)

The University of Louisville's National LoDI Index crashed from 58.86 in August to 51.52 in September, and then rose to 51.74 in October. Wow. Was the crash related to the government shutdown and debt ceiling? According to the index's notes at the St. Louis Fed, "an index at or above 50 represents a healthy level of activity in the industry." Here's what it measures:

The LoDI Index uses linear regression analysis to combine cargo volume data from rail, barge, air, and truck transit, along with various economic factors. The resulting indicator is designed to predict upcoming changes in the level of logistics and distribution activity in the US and is represented by a value between 1 and 100. An index at or above 50 represents a healthy level of activity in the industry

The University of Louisville said:

The National LoDI Index for October is 52. This shows the index is holding strong from last month. It is also the highest October value since 2008 which shows that the industry has maintained a certain level of growth from the last few years.

So was the initial spike a one-off event? What happened?

Source: St. Louis Fed

Here's a video I found that explains the data in the index.


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