The BCREA Commercial Leading Indicator fell 0.2 points to 145.6 in the third quarter of 2024, while the six-month moving average also fell to 145.7. Compared to the same quarter in 2023, the index was up 0.3%.

Third Quarter Highlights

• The economic activity index declined in Q3 by 0.2 points. Contraction in this index was broad-based, with inflation-adjusted retail trade (-0.3%), wholesale trade (-0.7%), and manufacturing sales (-0.3%) falling from the previous quarter.

• Office employment (financial, insurance, real estate, and professional services) fell by 3.3% in the third quarter, while manufacturing employment increased by 0.8%. The overall employment component declined by 0.6% from the previous quarter, contributing negatively to the index.

• The financial component of the index increased in the third quarter by 0.7 points. Real Estate Investment Trust (REIT) prices rose by 10.2%, pushing the component up. Conversely, interest rate spreads increased from the previous quarter, indicating more perceived short-term risk in the economy. However, this effect only partially offsets the strong increase in REIT prices, leading to a net positive impact on commercial activity for the overall component.

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Commercial Leading Indicator Fell in Third Quarter 2024 by Amit Sidhu | Economist | BCREA