Economy Archive

The combined Credit Managers’ Index (CMI) improved 0.5 points to 55.2. Stronger favorable factors, particularly gains in Dollar Sales and Dollar Collections, drove the increase, while both the manufacturing and service sectors remained in expansion. However, persistent weakness in Accounts Placed for Collection and growing concerns about payment resistance suggest that cash-flow pressures have not fully eased.

In the 12-month period ending in June, bankruptcy filings rose 12.2%, according to U.S. Courts. This surge signals economic volatility and increases credit risk. 

With high inflation, increasing energy costs and interest rate hikes, customers are pushing back on set payment deadlines to preserve their cash flow. As customers seek longer payment terms to preserve cash, credit managers must balance customer needs with the risk of delayed payments.

Credit professionals are navigating shifting market conditions, from tariffs to high energy costs, that are reshaping how businesses pay their bills. But amid the uncertainty, there’s room for opportunities. For credit teams, the challenge isn’t choosing between caution and growth—it’s balancing both. 

The Federal Reserve raised its target range from 3.75% to 4% in mid-September, the first rate hike since 2023, with policymakers suggesting there will be another increase this year as they fight inflation. Why it matters: With businesses already grappling with higher prices, an interest rate hike creates competing pressure that, over time, will cool construction activity while raising the cost of embarking on a project as prices rise throughout the supply chain.  “Higher rates don’t remove tariffs or fix supply constraints, and they make it more expensive for distributors to carry…

A customer that has paid on time for several years could start falling behind in an instant, as every business fluctuates as it responds to changing economic conditions. This seems to be the case in recent months, as credit managers have noted increases in payment delays and requests for new terms. By the numbers: The seasonally adjusted combined Credit Managers’ Index (CMI) declined 1.8 points in August, slipping to 54.6. The driving force of this drop was a deep drop in dollar sales, which had seen sharp positive growth the previous month. Why it matters: Volatility in dollar sales is…

NACM’s seasonally adjusted combined Credit Managers’ Index (CMI) declined 1.8 points to 54.6.

What started as a promising trade agreement between Canada and the United States has turned upside down this past weekend, straining a long-standing business partnership. On August 25, Canada imposed counter-tariffs ranging from 15% to 50% on American goods a few days after the U.S. introduced a 50% tariff on roughly $20 billion in Canadian imports.