San Diego's index of leading economic indicators jumped a half of a percent in July, the second straight sharp increase.
It has been nine months since the index retreated and that bodes well for the region's economy.
Requests for building permits jumped by nearly 3 percent and that drove the indexes upward movement.
"That's an important indicator because that's a signal of construction activity. And that's also a signal of activity in housing sales and rentals and furniture sales, appliances, things like that," said Alan Gin, the University of San Diego economist who compiles the numbers.
There was also positive movement in stock prices, consumer confidence and view of the national economy.
The weakness in the index was in the job market.
"Initial claims for unemployment insurance were up, which is a negative for the index. And also help wanted advertising was down for the fifth month in a row, so a little bit of softness in the labor market," Gin said.
The seasonally adjusted unemployment rate has climbed to 4.4 percent as the soft labor market continues to be a point of concern.
Even so, Gin expected solid economic growth through the middle of next year.
