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Comerica report says tech sector drives California gains

05/24/2012

The Sacramento Bee - May 23, 2012 - by Mark Glove

Dallas-based Comerica Bank's California Economic Activity Index broke a streak of flat readings in March, rising nearly two points to 101.

March's reading is 28 points, or 38 percent, above the index cyclical low of 73.2. Year-to-date, the index has averaged 100, one point above the average for all of 2011.

Robert Dye, Comerica's chief economist, said the latest reading in today's report reflected "ongoing strength in the state's high-tech sector. However, economic momentum in the state remains somewhat patchy, and overall job growth is below the national average.

"State fiscal conditions are challenging, and more fiscal tightening at the state level is expected. This will add to the drag from federal fiscal tightening, increasing the headwinds against private sector growth."

The California Economic Activity Index is compiled from eight variables: nonfarm payrolls, exports, sales tax revenue, hotel occupancy rates, continuing claims for unemployment insurance, building permits, the Baker Hughes Rotary Rig Count and the Silicon Valley 150 Index. All data are seasonally adjusted and indexed to a base year of 2008.

Comerica Bank has 105 banking offices in California, including Sacramento.