Michigan Economy Shifts Into High Gear: Economic Activity Index Rebounds to a Ten-Year High in July
Here's some extremely positive news about the Michigan economy, which would be consistent with recent reports about the rebound in Midwest manufacturing, and especially strong gains in Midwest automotive production:
Comerica Bank’s Michigan Economic Activity Index (a composite index based on 7 individual variables) increased 2.0 points in June, spiking to a level of 105.9. The June index reading is 46 points, or 77%, above the index cyclical low of 59.9 in mid-2009. The index has averaged 102 points over the first half of 2012, 11 points above the index average for all of 2011.
“The Michigan economy pushed further ahead in June, with our Michigan Economic Activity Index up strongly for the second month,” said Robert Dye, Chief Economist at Comerica Bank. “The rate of job creation has slowed over the first two quarters of the year as U.S. auto sales have plateaued around a 14 million unit annual sales rate in 2012. But outside of durable goods manufacturing, we are seeing ongoing gains. Housing markets statewide are improving as sales and prices increase. New home construction remains low, but is expected to increase to meet pent up demand.”
MP: The Michigan Economic Activity Index in July was at its highest level since 2002, ten years ago. If we're in a recession, or on the edge of one, it sure isn't being reflected in the Michigan economy, which is doing better now than at any time during the last ten years, according to Comerica Bank's Michigan Economic Activity Index. If we were close to a recession, wouldn't that blue line in the chart above be going down, and not sharply up?
Related: Michigan statewide home sales in July were almost 14% ahead of last year, and year-to-date sales are 10.4% above last year. Average home prices in July were 6.55% above a year ago, and year-to-date average prices are 4.83% ahead of last year.