California’s Comerica Bank index improves
DALLAS, July 20, 2021 / PRNewswire / – The Comerica Bank California Economic Activity Index rose in May to 114.0. The May reading is 23% above the all-time low of 92.7 set in june 2020. The index averaged 107.9 points in 2020, 18.9 points below the average for all of 2019. The April index reading was not revised to 110.9.
Our index of economic activity in California improved for the eleventh consecutive month in May. Seven of the sub-indices rose in May, including non-farm employment, UI claims (reversed), house prices, state total trade, hotel occupancy, boardings and state revenues. Industrial demand for electricity and housing starts fell over the month. Recent gains in the California index are consistent with a robust recovery in the state’s economy through May. In June, California removed most pandemic restrictions. The delayed reopening puts California recovery behind other key markets of Comerica. however, California Real GDP could post above-average gains in the third quarter as business activity rebounds, especially in the service sector. A major risk for the recovery is the current increase in COVID cases due to the Delta variant. More than 70 percent of California population, 12 years of age and over, are at least partially vaccinated. So while an increase in the number of cases in the third quarter could lead to some disruption in business, we do not currently expect to California to return to stricter social policies at the state level. One obstacle to household spending in the second half of 2021 is the gradual reduction in improved federal unemployment benefits which are expected to expire in September. California the non-agricultural wage bill remains below 1.24 million February 2020 levels. Even if hiring improves, the workforce recovery will not be 1 to 1. This means lower incomes for thousands of people. California households in T4.
The California Economic Activity Index consists of nine variables, as follows: non-farm payroll employment, ongoing UI claims, housing starts, house price index, industrial electricity sales, total trade, occupation of hotels, embarkations and state revenues. All data is seasonally adjusted. Nominal values have been converted to constant dollar values. Index levels are expressed in terms of three-month moving averages.
Comerica Bank is a subsidiary of Comerica Incorporated (NYSE: CMA), a financial services company headquartered in Dallas, Texas, and strategically aligned by three business lines: commercial banking, retail banking and wealth management. Comerica focuses on relationships and helps people and businesses succeed. In addition to Texas, the branches of Comerica Bank are located in Arizona, California, Florida and Michigan, with selected companies operating in several other states, as well as in Canada and Mexico. Comerica declared total assets of $ 86.3 billion at March 31, 2021.
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