DALLAS, Aug. 27, 2019 /PRNewswire/ -- Comerica Bank's California Economic Activity Index increased 0.1 percent in June to a level of 124.5. June's reading is 27 points, or 27 percent, above the index cyclical low of 97.8. The index averaged 124.0 points in 2018, 2.8 points above the average for all of 2017. May's reading was revised to 124.4.
Comerica Bank's California Economic Activity Index extended recent gains in June, now improving for four consecutive months. The index subcomponents were split between gains and losses in June. The positives included nonfarm employment, unemployment insurance claims (inverted), house prices and the Dow Jones Technology Index. The negative components for June were housing starts, industrial electricity demand, total state trade and hotel occupancy. Trends in the subcomponents remain mixed heading into the second half of 2019. Our California nonfarm employment index has improved every month since May 2011, indicating that job growth continues to anchor the California economy. California house prices have also improved in recent months after dipping through the first couple of months in 2019. Recent lower mortgages rates support opportunistic home buying, supporting area house prices. However, this support may only be limited given constraints on many potential first time home buyers. California housing starts dipped in June after three consecutive monthly increases. They were down 25 percent through June from the same time period in 2018. The value of state total trade, now down 11 percent from the February 2018 peak, is another cautionary sign for the California economy. The recent escalation in trade tariffs between the U.S. and China is expected to further weigh on California trade through the second half of 2019.
The California Economic Activity Index consists of eight variables, as follows: nonfarm payroll employment, continuing claims for unemployment insurance, housing starts, house price index, industrial electricity sales, total trade, technology stock index and hotel occupancy. 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 locations in the key California markets of San Francisco and the East Bay, San Jose, Los Angeles, Orange County, San Diego, Fresno, Sacramento, Santa Cruz/Monterey, and the Inland Empire, is a subsidiary of Comerica Incorporated (CMA). Comerica is a financial services company headquartered in Dallas, Texas, and strategically aligned into three major business segments: the Business Bank, the Retail Bank, and Wealth Management. Comerica focuses on relationships and helping businesses and people be successful..
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