Comerica Bank’s Michigan economic index falls

DETROIT–Comerica Bank’s Michigan Economic Activity Index declined in March to a level of 114.5 from February’s 118.4.

The index consists of nine variables: nonfarm payroll employment, continuing claims for unemployment insurance, housing starts, house price index, industrial electricity sales, auto assemblies, total trade, hotel occupancy and sales tax revenue.

Comerica officials said the index in March began to show the effects of the coronavirus pandemic, and expect that will be continued deterioration in April. During the month, the only positive index component was house prices. All other components of the index declined. Unemployment in the state rose from 4.3 percent in March to 22.7 percent in April, as auto production ground to a halt. While economists said not all shuttered business will reopen and not all furloughed employees will be called back, improvement is expected in the May and June data.

All data in the index are seasonally adjusted, converted to constant dollar values, and are expressed as three-month moving averages.

March’s reading is 17 points, or 17 percent, above the index cyclical low of 97.9, reached at the bottom of the 2007-09 recession.

The index averaged 117.7 points for all of 2019, 0.9 points below the index average for 2018.

To subscribe to Comerica economic publications or for questions, email ComericaEcon@comerica.com. Archives are available at http://www.comerica.com/insights.

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