Michigan Economic Index Drops in October
DETROIT -- Comerica Bank's Michigan Economic Activity Index dipped lower in October, dropping 2.7 points, to a level of 100.6.
The October index reading was still 41 points, or 68 percent, above the index cyclical low of 59.9, reached at the bottom of the last recession. And the index has averaged 103 points thus far in 2012, 12 points above the index average for all of 2011.
"In October the Michigan Economic Activity Index dropped to its lowest point since last January, weighed down by weakening job growth," said Robert Dye, chief economist at Comerica Bank. "Other data for October was more positive, as motor vehicle production rose and home construction indicators picked up. Vehicle sales surged in November, as vehicles destroyed by Hurricane Sandy were replaced. We expect auto sales to continue to improve through 2013 as long as we avoid a 'fiscal cliff'-induced recession in early 2013."
The Michigan Economic Activity Index consists of seven variables: nonfarm payrolls, exports, sales tax revenues, hotel occupancy rates, continuing claims for unemployment insurance, building permits, and motor vehicle production. All data are seasonally adjusted, as necessary, and indexed to the base year of 2004, which is equal to 100 on the index. Nominal values have been converted to constant dollar values. Index levels are expressed in terms of three-month moving averages.
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