Magazine article Business Credit

CMI Bounces Back in June with Strong Showing

Magazine article Business Credit

CMI Bounces Back in June with Strong Showing

Article excerpt

NACM's Credit Managers' Index (CMI) has been on a roller coaster ride for the last few months, and the numbers for June reflect a noticeable bump over May's disappointing results.

'The variability would be more problematic were it not for the fact that this behavior has been mirrored in all kinds of other data streams," said NACM Economist Chris Kuehl, Ph.D. "As with the data over the last few months, the majority of the shift this month was due to the same two categories: dollar collections and accounts beyond terms."

After falling to 53.6 in May, the combined score for June reached 56.1, the highest level its been in over a year. The combined favorable factors in June also surged over the 60 mark reached in May to a height last seen several years ago. Overall, unfavorable factors also improved, moving out of contraction territory (under 50) in June.

Some of the subcategories in the CMI's favorable factors jumped significantly in June. Sales, for instance, increased to a reading of 66.5 from 60.6 the month prior, again leaving a high mark last seen several years ago. Dollar collections, which have been up and down for the past four months, also saw significant improvement.

Among the unfavorable subcategories, only two-dollar amount of customer deductions and accounts placed for collection-remained in contraction territory in June compared with four in May. …

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