Comerica Bank's Michigan Economic Activity Index rose 4 points in January to a level of 81, the highest Index observation since November 2008. The Index for January is up 6 percent compared to the June 2009 cyclical low.
"After plateauing for three months, our Index surged in January, with eight of nine components contributing positively," said Dana Johnson, Chief Economist at Comerica Bank. "The January reading was driven by strong steel production and natural gas sales. Given the severe weather patterns experienced in the early part of this year, gas sales likely outpaced normal seasonal trends in February as well, which should give the upcoming Index another boost. Over the course of the year, the Index should continue to trend higher, reflecting an ongoing recovery in Michigan."
It should be noted that two compositional changes have been made to the Michigan Economic Activity Index. First, employment is now measured by nonfarm payrolls from the establishment survey rather than the employment estimate generated in the household survey. Second, to smooth volatility and emphasize the underlying trends in the Michigan economy, Index levels will henceforth reflect a three-month moving average. Additionally, seasonal factors estimated by Comerica have been revised as part of a semi-annual process. A complete Index history reflecting these changes is available upon request.
The Michigan Economic Activity Index equally weights nine, seasonally-adjusted coincident indicators of real economic activity. These indicators reflect activity in the construction, manufacturing and service sectors as well as job growth and consumer outlays.