Comerica Bank’s California Economic Activity Index grew by 1.0 percentage points in August to a level of 122.7. August’s reading is 39 points, or 46 percent, above the index cyclical low of 84.1. The index averaged 119.8 points for all of 2015, six and two-fifths points above the average for all of 2014. July’s index reading was 121.7.
“Our California Economic Activity Index increased again in August, its sixth consecutive monthly gain after stalling over the year from March 2015 through March 2016. During the stall, the NASDAQ 100 Technology Stock index dipped, defense spending eased and housing starts retrenched. These negative forces were roughly balanced by improving labor metrics, especially ongoing payroll job creation. Over the last six months, tech stocks have performed better, defense spending has stabilized and housing starts have gained some momentum. In August, six out of eight index components were positive including payroll employment, state exports, housing starts, defense spending, house price index and the tech stock index. Only initial claims for unemployment insurance (inverted) and hotel occupancy dipped for the month,” said Robert Dye, Chief Economist at Comerica Bank. “Even though we are seeing anecdotal reports of the northern California real estate market cooling, the Case-Shiller house price index for San Francisco increased by 1.0 percent in August.”
For a PDF version of the California Economic Activity Index click here: CaliforniaIndex_1016.