Comerica Bank’s Michigan Index Flattens as Auto Production Stabilizes

Comerica Bank’s Michigan Economic Activity Index declined in March, down 0.7 percentage points to a level of 127.2. March’s reading is 53 points, or 72 percent, above the index cyclical low of 74.0. The index averaged 124.3 points for all of 2015, seven points above the index average for 2014. February’s index reading was 127.9.

“Our Michigan Economic Activity Index dipped slightly in March and remains range bound since late last year. Jobs are still being added to the Michigan economy, but the state’s important manufacturing sector is facing three challenges. First, demand for manufactured goods from the oil and gas industry has collapsed. Second, the relatively strong dollar and tepid global demand are headwinds for export oriented manufacturing. Third, the auto sector increasingly looks like it is at the top of its cycle and will not significantly increase production from here,” said Robert Dye, Chief Economist at Comerica Bank. “Supporting the Michigan Index in March were payroll employment, house prices, auto production and sales tax receipts. Drags in the index in March came from exports, initial claims for unemployment insurance (inverted), housing starts and hotel occupancy.”

MI Index 0516

For a PDF version of the Michigan Economic Activity Index click here: Michigan_0516.

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