DALLAS, April 29, 2020 /PRNewswire/ -- Comerica Bank's Michigan Economic Activity Index increased in February to a level of 118.6. February's reading is 21 points, or 21 percent, above the index cyclical low of 97.9. The index averaged 117.7 points for all of 2019, 0.9 points below the index average for 2018. January's index reading was revised to 117.9.
Due to reporting lags in state-level economic data, the February edition of our Comerica state economic activity indexes does not fully reflect the swift and powerful contraction in the U.S. economy this spring due to the global coronavirus pandemic. In February, our Michigan Index increased for the third consecutive month, showing favorable economic conditions early this year. Eight out of nine sub-indexes were positive in February, including nonfarm payrolls, unemployment insurance claims (inverted), housing starts, house prices, industrial electricity demand, total state trade, hotel occupancy and state sales tax revenue. The light vehicle production sub-index was unchanged for the month. In the March data, we expect to see most of the sub-indexes begin to deteriorate, due to coronavirus-related social mitigation policies. The April data will likely show a significant deterioration across most sub-indexes. U.S. auto sales and production for April is already expected to be historically low. Because of volatility in many state-level economic series, our sub-indexes are based on three-month moving average of the original data series. That smoothing process means that the sub-indexes for May will show an ongoing deterioration from April. Michigan is expected to continue its shelter-in-place order at least through May 15. Even though some states are beginning to lift restrictions now, their economies will take some time to show consistent improvement.
The Michigan 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, auto assemblies, total trade, hotel occupancy and sales tax revenue. All data are seasonally adjusted. Nominal values have been converted to constant dollar values. Index levels are expressed in terms of three-month moving averages.
Comerica Bank, with one of the largest banking center networks in Michigan, is a subsidiary of Comerica Incorporated (NYSE: CMA), a financial services company headquartered in Dallas, Texas, and strategically aligned by three business segments: The Business Bank, The Retail Bank, and Wealth Management. Comerica focuses on relationships, and helping people and businesses be successful. In addition to Michigan and Texas, Comerica Bank locations can be found in Arizona, California, and Florida, with select businesses operating in several other states, as well as in Canada and Mexico.