Expect to see continued gains from the February Credit Managers’ Index (CMI) when it’s released Wednesday morning. In addition to solid growth in the overall index, certain key categories received a boost and provided another dose of confidence to the still leery American economy.
“The mood of the country could best be described as cautious and perhaps a little encouraged as far as economic growth prospects are concerned,” said Chris Kuehl, PhD, economist for the National Association of Credit Management (NACM). The question mark stems from the last month’s sudden spike in oil prices and its potential impact on the price of gasoline. Kuehl noted that in the past this kind of leap was enough to send the economy hurtling back into recession, but thus far the consumer seems to be taking it in stride.
How long the even temperament of consumers will last is anyone’s guess, but if the threat of high prices turns out to be a temporary one, expect both consumers and businesses to breathe heavy sighs of relief and return to focusing on the good news that has so far dominated the start of 2012. “There has been good news on the job front, better demand numbers, better growth numbers and better numbers in the CMI,” Kuehl added.
Sales numbers also grew in February, which signaled future improvements in the index’s unfavorable factors in the months to come. “An expansion in sales allows companies to catch up on their debt and improve their overall credit standing,” said Kuehl. “This bump in overall business activity is a precursor to additional expansion.”
The full CMI report for February 2012 with commentary, tables and graphs will be available Wednesday. CMI archives may also be viewed here.
Jacob Barron, CICP, NACM staff writer