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Credit Managers’ Index Declines in October, Upward Trend Stalls

November 01, 2017, 07:30 AM
Filed Under: Economic Commentary

Ghosts and goblins bedeviled the numbers for October as what looked like an upward trend stalled out after only two months. The Credit Managers’ Index (CMI) from NACM registered a decrease for the month, coming in at 55.5, one point below the score for September.

“The storms altered a lot of economic patterns,” said NACM Economist Chris Kuehl, Ph.D. “That has been seen in everything from volatile job numbers, changes in the rate of housing starts and even internal migration patterns for skilled workers. There are already signs of shifts as reconstruction gets thoroughly underway.”

Healthy numbers were still to be found in the index of favorable factors. The sales category fell back, but still remained high at 66.8, the second-best reading in a year. New credit applications improved, indicating a greater demand for credit and a desire to grow and expand. Though there was also a decline in the amount of credit extended, favorable factors remained in solid territory.

Conditions were worse among the unfavorable factors. While nearly all were in expansion territory last month, the situation is reversed in October, with only two categories in the expansion zone and both seeing some decline from the month before. The overall reading just skirted contraction, leveling off at 50. The numbers for dollar amount beyond terms dove into the contraction zone with a dip of three points. “The volatility that has characterized the CMI for the last several months has been largely attributed to the vagaries of the slow pay,” explained Kuehl. The readings for filings for bankruptcies and rejections of credit applications both fell, but stayed in expansion territory.

“What doesn’t show up that well with this data is the stark difference between the readings for the favorable categories and the unfavorable,” Kuehl said. “The favorable numbers are consistently in the 60s and the unfavorable keep sinking into the 40s and the contraction zone.”

For a complete breakdown of the manufacturing and service sector data and graphics, view the October 2017 report at CMI archives may also be viewed on NACM’s website at

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