Key Currency Exchange Rates for Friday, 8/28/20

Second quarter results were constrained by continued demand weakness, particularly at FedEx Express. FedEx Express operating income declined 64% year-over-year due to lower global volumes, partially offset by an 8% package yield increase. FedEx Express implemented previously planned and incremental cost reduction actions during the quarter to mitigate the impact of volume declines, including structural air network changes and the temporary parking of aircraft. FedEx Ground operating income increased 24% year-over-year, due primarily to a 13% yield increase and cost reduction actions. These factors were partially offset by increased purchased transportation rates, lower package volume, and higher other operating expenses. FedEx Freight operating income increased 32% year-over-year, driven by an 18% yield increase. This was partially offset by higher salaries and employee benefits and decreased shipments. Second quarter fiscal 2022 net income included a pre-tax, noncash MTM net loss of $260 million ($195 million, net of tax, or $0.73 per diluted share) related to the termination of a TNT Express European pension plan and a curtailment charge related to the U.S. FedEx Freight pension plan.

American Dollar to Canadian Dollar = 0.790589; American Dollar to Chinese Yuan = 0.149829; American Dollar to Euro = 1.174149; American Dollar to Japanese Yen = 0.009169; American Dollar to Mexican Peso = 0.055936.

American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index decreased 1.2% in July after falling 2% in June. In July, the index equaled 109.8 (2015=100) compared with 111.1 in June. “Softness in tonnage over the last few months is due more to supply constraints, rather than a big drop in freight volumes,” said ATA Chief Economist Bob Costello. “Not only are there broader supply chain issues, like semiconductors, holding tonnage back, but there are also industry specific difficulties, including the driver shortage and lack of equipment. For-hire truckload carriers are operating fewer trucks than a year earlier. It is difficult to haul significantly more freight with fewer trucks and drivers. “In addition to these supply issues, retail sales and housing starts, both large drivers of truck freight, retreated in July, although both rose on a year-over-year basis,” he said. June’s reading was revised down to -2% from our July 20 press release. Compared with July 2020, the SA index fell 2.9%, which was the first year-over-year drop since March. In June, the index was flat from a year earlier. Year-to-date, compared with the same seven months in 2020, tonnage is down 0.2%.