DETROIT, June 27 /PRNewswire-FirstCall/ -- The Michigan Business Activity Index, compiled by Comerica Bank, fell four points to 102 in May. That is the lowest reading for the index since September 2001. So far this year, the index has averaged about 3 percent lower than in 2004.
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"The recent cutbacks in the auto industry are the main reason that activity slowed in May, but unusually cool weather last month probably contributed to the weakness in our index," said Dana Johnson, chief economist at Comerica Bank.
"I would not be surprised if the May reading turns out to be the near-term bottom for our index, but consistent gains in activity are not likely over the second half of 2005. Even if aggressive discounting helps to stabilize the market share of General Motors and Ford, profit, employment, and compensation trends won't be strong in the Michigan-based auto industry for some time to come."
The Michigan Business Activity Index (MBAI) represents 10 different measures of Michigan economic activity compiled monthly by the Economics Department of Comerica Bank. The MBAI is seasonally adjusted, corrected for inflation, and expressed on an index basis with base year 1996 equals 100. The MBAI series has been calculated monthly since 1957 and depicts state economic activity over seven full swings of the U.S. business cycle.
Comerica Bank, Michigan's oldest and largest bank, is the lead subsidiary of Comerica Incorporated (NYSE: CMA), a multi-state financial services provider headquartered in Detroit.
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