DALLAS — Comerica Bank’s Michigan Economic Activity Index improved marginally in October, increasing to a level of 127.3. That was up from 127.1 in September.
The Michigan Economic Activity Index consists of eight variables, as follows: nonfarm payrolls, exports, hotel occupancy rates, continuing claims for unemployment insurance, housing starts, sales tax revenues, home prices, and auto production. All data are seasonally adjusted, and indexed to a base year of 2008. Nominal values have been converted to constant dollar values. Index levels are expressed in terms of three-month moving averages.
October’s reading is 53 points, or 72 percent, above the index cyclical low of 74.1, hit at the bottom of the last recession.
The index averaged 117.4 points for all of 2014, three and three-tenths points above the index average for 2013.
Said Comerica chief economist Robert Dye: “Four index components were positive for the month, including unemployment insurance claims, housing starts, state sales tax and hotel occupancy. State exports, house price index, and auto production were negative factors, and payroll employment was unchanged. Auto production has ramped up significantly since the bleak days of 2009, supporting gains in our Michigan index. However, going forward we expect auto production to plateau and then gradually decline, reflecting very strong auto sales through late 2015 that will most likely ease by 2017, if not sooner. The U.S. manufacturing sector generally is facing headwinds with soft global demand, the strong dollar and the weak energy sector.”