Credit Managers see slowdown

By Staff -- Home Textiles Today, 1/2/2007 11:35:00 AM

Columbia, Md. -- With the nation's corporate credit watchdogs growing more wary, the monthly Credit Managers' Index fell for a fifth straight month in December, dropping to its lowest level since April 2003.

The National Association of Credit Management (NACM) said its index fell 0.5% to a reading of 54.7, with seven of the 10 components of the index heading south.

The trade group said info rmation coming from its members "strongly suggests a slowing economy and remains consistent with data from the rest of the macro-economy indicating a slowdown," specifically weak GDP growth for two straight quarters, weakness in durable goods orders, modest holiday sales, and signs of weakness in the labor markets.

Measured on a year-over-year basis, the Credit Managers' Index has fallen 3.6% to a level of 54.7 with nine of the 10 components falling. The 12-month drop was driven mostly by deterioration in the services sector, which fell 7.5%. Manufacturing eked out a slender gain of 0.4%.

"Overall, the year-over-year data continues to suggest an economy slowly weakening under the strain of tightened monetary policy and a decimated housing market," the NACM reported.