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Comerica Bank’s Michigan Index Unchanged

March 28, 2018
By Robert A. Dye, Ph.D., Daniel Sanabria

Comerica Bank’s Michigan Economic Activity Index remained unchanged in January at a level of 118.3. January’s reading is 20 points, or 21 percent, above the index cyclical low of 97.9. The index averaged 118.1 points for all of 2017, four-fifths of a point above the index average for 2016. December’s index reading was revised to 118.3.

Comerica Bank’s Michigan Economic Activity Index was unchanged in January, following three consecutive monthly increases between October and December. The index was split between gains and losses. Five of the nine sub-indexes were positive for January, including nonfarm-payrolls, house prices, industrial electricity demand, total state trade and hotel occupancy. The four sub-indexes that were negative for the month were unemployment insurance claims (inverted), housing starts, auto production and state sales tax revenues. This is not the first time that the index has gone unchanged in recent history. Last year the index stalled in June and turned south from July to September as state nonfarm payrolls declined. At the same time, auto production saw an 11 month decline from November 2016 through September 2017. January’s stall strikes a cautionary note, however there are some positives. First, Michigan continued to see monthly nonfarm payroll gains through February. The labor market remains solid as monthly unemployment insurance claims approach historical lows. Second, while the boost from post-hurricane auto sales last fall continues to dissipate, the sales rate is dropping to pre-hurricane levels slower than originally anticipated. This could be a sign that auto sales will remain stronger than expected this year. A major wildcard this year is international trade. The eighth round of NAFTA talks is tentatively set for April.

For a PDF version of this report click here: MI-Index-0318.

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