NACM Credit Manager’s Index October 2006

The seasonally adjusted Credit Manager’s Index (CMI) fell 1.8% points in October, reflecting a widespread deterioration as eight of the 10 components fell. While all but one component remain above the 50% level indicating economic expansion, it was the third consecutive drop for the combined index. “In addition, the drop was led by a sharp fall in the sales component of 7.2% points, an unsettling number since a decrease in sales can suggest a deterioration in future business conditions as well,” said Dan North, Chief Economist with credit insurer Euler Hermes ACI. “The credit managers in the survey are confirming what other macroeconomic data suggest; the effects of a tightening monetary policy and a dismal housing market are taking a toll on the health of the economy.”

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