21/11/2024
During the September quarter, the National Road Carriers Association's (NRC) cost index tool found mixed cost pressure for the road transport industry, with diesel prices falling but labour, tyres, and vehicle parts prices rising. Interest rate relief kept transport costs subdued for the period. Many in the industry will be glad to see the positive effect of these lower debt-serving costs on cashflow. A further OCR announcement is scheduled for next week, so we will watchcarefully to see how any potential rate adjustments will affect business rates. A reduction in OCR is expected, and this will likely lead to reductions in floating and short term interest rates. However, longer term interest rates that are frequently used for asset finance in the transport industry, are more impacted by international wholesale markets. These have risen over the last six weeks or so based on market expectations that the reduction in central bank interest rates, particularly in the USA, will not fall as far or as fast as was expected. More here:
Cost pressures for the road transport industry were mixed in the September quarter, with diesel prices down, while labour, tyres,
