NACM’s CMI Continues Up and Down Trend

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Credit professionals are reporting a decline in the favorable factors of the December economic report from the National Association of Credit Management, but with any bad news there is always good, which was seen as many unfavorable categories increased.

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The favorable categories have been near record levels for much of 2017, so even with the large drop, the overall score is comfortably in expansion territory.

The swing of the pendulum continued in the December Credit Managers’ Index (CMI) from NACM, and it is headed in the wrong direction as credit professionals prepare for a final holiday rush. After breaking a more than three-year-long record in November, the December CMI has reversed course with its combined reading of 54.2, down from 56.6 in November.

“In November, the sense was that real progress was ahead and many people have been speaking of 2018 with great expectations,” said NACM Economist Chris Kuehl, Ph.D. “It may yet work out that way. This month may be written off as an anomaly, but it may also signal that some of those weaknesses that had been warned about are manifesting.”

Most of the reversal was within the favorable categories, which saw a large drop off and fell out of the 60s for the first time since last December. The favorable factors index is at 59.4 after a more than six-point drop in December. All favorable factors—sales, new credit applications, dollar collections and amount of credit extended—in the combined and manufacturing and service sectors saw a decline this month. The favorable categories have been near record levels for much of 2017, so even with the large drop, the overall score is comfortably in expansion territory.

With the bad comes the good. The combined index of unfavorable factors stayed in expansion (above 50) for the fifth straight month and increased in December. A reading of more than 50 indicates economic growth, and the opposite is true when the number is under 50. Overall, credit application rejections, accounts placed for collection and bankruptcy filings saw only minor declines this month. Disputes, dollar amount beyond terms and dollar amount of customer deductions all edged closer to the expansion zone.

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

NACM, headquartered in Columbia, MD, supports more than 13,000 business credit and financial professionals worldwide with premier industry services, tools and information. NACM and its network of affiliated associations are the leading resource for credit and financial management information, education, products and services designed to improve the management of business credit and accounts receivable. NACM’s collective voice has influenced federal legislative policy results concerning commercial business and trade credit to our nation’s policy makers for more than 100 years, and continues to play an active part in legislative issues pertaining to business credit and corporate bankruptcy. NACM's annual Credit Congress & Exposition conference is the largest gathering of credit professionals in the world.

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Nick Stern
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