DALLAS, Aug. 23, 2021 /PRNewswire/ -- Comerica Bank's Texas Economic Activity Index increased in June to 125.2. June's index reading was 26.1 percent above the recent low of 99.3 set in June 2020. The index averaged 112.1 points for all of 2020, 13.5 points below the average for 2019. May's index reading was revised to 122.9.
Our Texas Economic Activity Index increased by 1.9 percent in June, after rising a strong 4.0 percent in May. This marks the fourth consecutive monthly gain for the index. Eight of the nine index components rose in June. They were nonfarm employment, unemployment insurance claims (inverted), house prices, industrial electricity demand, drilling rig count, total state trade, hotel occupancy and state sales tax revenue. Only the housing starts sub-index declined for the month. The Texas Index saw a strong rebound this spring and is now just 0.9 percent below the February 2020 read. We expect the Texas Index to reach its pre-pandemic peak over the next couple of months. However, the current surge in COVID cases has the potential to cause more headwinds for economic activity heading into the fall. News that China's economy slowed more than expected this summer and recent weaker-than-expected data coming out of the U.S is dampening the outlook for oil demand. WTI crude oil front month contracts have moved down from $74 per barrel at the end of July to around $62 per barrel in mid-August. Texas drilling rig counts have so far held steady at 230 rigs in the first three weeks of August. The state's surge in COVID cases has resulted in dwindling hospital ICU capacity. This will weigh on consumer and business confidence in the near-term. However, statewide restrictions on business activity remain unlikely at this time.
The Texas Economic Activity Index consists of nine variables, as follows: nonfarm payroll employment, continuing claims for unemployment insurance, housing starts, house price index, industrial electricity sales, Texas rotary rig count, total trade, hotel occupancy and sales tax revenue. All data are seasonally adjusted. Nominal values have been converted to constant dollar values. Total 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 segments: The Commercial Bank, The Retail Bank, and Wealth Management. Comerica focuses on relationships, and helping people and businesses be successful. In addition to Texas, Comerica Bank locations can be found in Arizona, California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico. Comerica reported total assets of $88.4 billion at June 30, 2021.
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SOURCE Comerica Bank
