CMI Sneak Peak: Positive Trend May Prove Elusive in June Statistics

Although data won’t be finalized and released by NACM until Tuesday, the June 2015 Credit Managers’ Index (CMI) seems to have something for everybody: the optimists, the pessimist and the neutrals. That’s not necessarily a good thing for fans of consistency. 

It appears the June CMI reading will not build upon the last two month’s increases, though the combined index also is nowhere near the level of contraction. “It’s more of the see-saw, and this is really starting to get tiresome,” said NACM Economist Chris Kuehl, Ph.D. “Every month there comes a new set of data releases. Every month the clear statement proves to be elusive once again. There always seems to be something for both optimists and pessimists to latch on to.”

The silver lining is that the CMI readings have remained well above the 50 line that divides expansion from contraction for more than three years. In addition, there will likely be positive news within the Index of Favorable Factors, notably in new applications and amount of credit extended, than bad. Even categories that seem to be on a mild downward trend, like sales, should remain comfortably in the upper 50s.

The unfavorable factors, however, could be the black cloud for June, as preliminary statistics foreshadow a decline from May’s level (50.9) that was already too close to contraction for comfort.

Manufacturing data also appear to lack anything resembling continuity of late, according to Kuehl. “On the one hand, there is some hope for better numbers in the future, as the favorable look better than they have in a long while; but the present is not so positive, as the unfavorables are getting worse,” he said. “[The latter] signals many companies are not in the shape they would like to be and are falling behind in their obligations.”

- NACM staff

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