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Comerica Bank’s Arizona Economic Activity Index increased 0.1 percentage points in March to a level of 111.9.

Comerica Bank’s Arizona Index Improves

June 4, 2018
By By Robert A. Dye, Ph.D., Daniel Sanabria

Comerica Bank’s Arizona Economic Activity Index increased 0.1 percentage points in March to a level of 111.9. March’s index reading is 12 points, or 12 percent, above the index cyclical low of 99.5. The index averaged 111.1 points for all of 2017, one point above the average for 2016. The February index reading was 111.8.

The Comerica Bank Arizona Economic Activity Index improved slightly in March. Six out of nine index components were positive in March including nonfarm payrolls, unemployment insurance claims (inverted), housing starts, house prices, total state trade and enplanements. The three negative components for the month were industrial electricity consumption, hotel occupancy and state taxable sales. Our Arizona index stalled from December through February. During this time, monthly job growth continued to improve, boosted by gains in the state’s construction, manufacturing and private services sectors. The sustained job growth helped to counter declines in our hotel occupancy and sales tax indexes, leading to the three consecutive monthly readings of 111.8. The Arizona Index is increasing again, signaling an ongoing moderate expansion for the Arizona economy heading into the second half of 2018. The outlook for the state’s housing sector also remains positive. The three consecutive monthly increases in our housing starts index are further evidence of healthy construction activity, particularly around the Phoenix metropolitan area. Arizona home prices continue to improve and year-over-year growth has accelerated in recent months. We expect the state’s housing market to continue to benefit from the state’s relatively high affordability which will boost in-migration of potential workers and baby boomers entering retirement.

Explanatory Note:

The Arizona Economic Activity Index consists of nine variables, as follows: nonfarm payroll employment, continuing claims for unemployment insurance, housing starts, house price index, industrial electricity sales, total trade, hotel oc-cupancy, state taxable sales and total enplanements. All data are seasonally adjusted. Nominal values have been con-verted to constant dollar values. Index levels are expressed in terms of three-month moving averages.

Comerica operates full-service banking centers throughout Maricopa County, including locations in Phoenix, Avondale, Goodyear, Mesa, Peoria, Scottsdale, Surprise and Tempe. In addition to Arizona, Comerica locations can be found in its headquarters state of Texas, as well as in California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico.

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For a PDF version of this report click here: Comerica Arizona Index

The articles and opinions in this publication are for general information only, are subject to change, and are not intended to provide specific investment, legal, tax or other advice or recommendations. The information contained herein reflects the thoughts and opinions of the noted authors only, and such information does not necessarily reflect the thoughts and opinions of Comerica or its management team. We are not offering or soliciting any transaction based on this information. We suggest that you consult your attorney, accountant or tax or financial advisor with regard to your situation. Although information has been obtained from sources we believe to be reliable, neither the authors nor Comerica guarantee its accuracy, and such information may be incomplete or condensed. Neither the authors nor Comerica shall be liable for any typographical errors or incorrect data obtained from reliable sources or factual information.