The roller-coaster ride among economic data may be reflected again in the Credit Managers’ Index (CMI) from the National Association of Credit Management, according to preliminary numbers. Contradiction is the word of the day as shifts in the economy continue from upbeat to downbeat.
“It looks like companies are catching up with their creditors one month and falling back the next,” said NACM Economist Chris Kuehl, Ph.D. “This is another month where they are losing ground.”
July data indicates a down month for the CMI. The numbers in the index’s unfavorable categories have been in the contraction zone for the better part of two years, showing the distress in the economy. Preliminary figures indicate, however, that new credit is in demand. Sales likely have slipped, consistent with the trend this year.
A majority of companies are apparently managing to stave off bankruptcy in the face of economic confusion. On the other hand, the score for rejections of credit applications experienced a significant decline, signaling worsening conditions.
Companies are still determined to expand their operations one way or another, as numbers in the manufacturing sector indicate an increase in new credit applications. Businesses in the service sector may have less stomach for expansion this holiday season. With credit applications likely down, retailers may be planning for a year of light inventory.
– Adam Fusco, associate editor
For a full breakdown of the manufacturing and service sector data and graphics, be sure to view the complete July 2017 report this coming Monday here. CMI archives may also be viewed on NACM’s website here.