Company: CMA
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0000028412-25-000235
Chunk: 126

Company: COMERICA INC
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 1
Chunk 126
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 prices fade. Energy prices were projected to hold below levels seen at the close of the first quarter of 2025, with supply outpacing demand and U.S. crude production holding near a record high. Residential real estate property prices were expected to rise at more moderate rates, while commercial real estate prices continued to face headwinds, both of which reflected the long and variable lags through which the FRB's restrictive monetary policy affect the real economy.

Downside risks to growth from trade conflicts, cost-of-living pressures on household finances and less expansionary fiscal policy were projected to collectively contribute to growth holding below its 2024 pace for the remainder of 2025 and into 2026. Reduced demand for office space and subdued economic activity in the central business districts of major metro areas are also expected to persist as drags on the broader economy. Demand for labor has cooled as businesses concentrate on investment in AI-related equipment and software. These headwinds are expected to be partially offset by the expansionary effects of fiscal policies enacted during the third quarter of 2025 as well as future policies that, at September 30, 2025, seemed likely to be enacted. 

These factors shaped the 2-year reasonable and supportable forecasts used by the Corporation in its CECL estimate at September 30, 2025. The U.S. economy was projected to grow at a below-trend rate through third quarter 2026 before gradually normalizing to its trend growth rate. The unemployment rate was expected to hold below 5%, while interest rate forecasts reflected market expectations and guidance provided by the FRB during the third quarter of 2025. The following table summarizes select variables representative of the economic forecasts used to develop the CECL estimate at September 30, 2025.

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Economic VariableBase ForecastReal GDP growthGrowth increases to 2.3% in first quarter 2027 before moderating to 1.9% annualized by third quarter 2027. Unemployment rateRanges between 4.3% and 4.5% throughout the forecast period. Spread of Corporate BBB bond to 10-year Treasury bondSpread widens to 1.9% by third quarter 2026 and remains steady throughout the remainder of the forecast period.Oil PricesPrices generally range between $61 and $65 per barrel over the forecast period.

Due to the high level of uncertainty regarding assumptions used as inputs to the forecast, the Corporation evaluated a range of economic scenarios, including more benign and more severe