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Comerica Bank’s Arizona Economic Activity Index increased by 0.1 percent in January to a level of 114...



Comerica Bank’s Arizona Index Ticks Up

March 29, 2019
By Robert A. Dye, Ph.D., Daniel Sanabria

Comerica Bank’s Arizona Economic Activity Index increased by 0.1 percent in January to a level of 114. January’s index reading is 15 points, or 15 percent, above the index cyclical low of 99.5. The index averaged 112.8 points for all of 2018, 1.8 points above the average for 2017. December’s index reading was revised to 113.9.

The Comerica Bank Arizona Economic Activity Index ticked up again in January, increasing for the sixth consecutive month. The  gains were wide spread for the month. Seven of the nine index components were positive in January. This included nonfarm employment, unemployment insurance claims (inverted), house prices, industrial electricity demand, state total trade, hotel occupancy and enplanements. The two negative index components in January were housing starts and state sales tax revenue. Our Arizona Index continues to improve, indicating ongoing economic momentum through 2018 and into early 2019. Strong job growth helped drive Arizona’s economic growth in 2018. One concern for the state’s labor market is the recent uptick in the unemployment rate from 4.7 percent in June of 2018 to 5.1 percent in February 2019. However, Arizona continuing unemployment insurance claims have steadily declined since last summer. Therefore, population growth and the re-entry of marginally attached workers into the labor force may be contributing factors to the recent increase in the state unemployment rate. The expansion of the labor force is a positive for the Arizona economy. The housing sector will also be a positive factor for Arizona this year. House prices, housing starts and construction employment were all up in 2018. Lower mortgage rates this year will support demand for Arizona housing and new home construction in 2019.



For a PDF version of this report, click here: Comerica Bank's Arizona Economic Activity Index.

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