Soft Exports, Falling Rig Count Slow Texas Growth

The index fell nearly half a percentage point in January to a reading of just over 101. It’s the first time the index has fallen since August. Comerica Bank chief economist Robert Dye says there’s little cause for concern.

“Exports were a little bit soft. Sales tax, a little bit soft. The drilling rig count, we know that’s been trending down, both for oil and more significantly for natural gas here through most of the last year. So, no big surprises there. Two components that were higher: overall jobs, payroll jobs, and building permits, residential building permits. So, mixed bag.”

Dye says Texas could face headwinds from fiscal tightening, particularly as cuts to defense spending filter down to contractors and subcontractors. But he expects the state will continue to enjoy moderate growth through the rest of the year.

Texas Economic Activity Index
Graph by Comerica Bank

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