Trade Tariffs Halt U.S. Small Manufacturers’ Hiring, Investments

The ripple effect of the U.S. administration's trade tariffs has struck the country's small manufacturers, Reuters reports, as they scale back hiring and investments due to rising import costs. Following President Donald Trump's implementation of steel and aluminum import taxes in March, Reuters began interviews with several small- to mid-sized man...
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Global Average DSO Hits 66 Days, Expected to Increase in 2018

Trustworthy relationships between companies and customers have boosted the global average Days Sales Outstanding (DSO) to a 10-year high, which credit insurer Euler Hermes recorded at 66 days in 2017. According to its May 5 report, Euler Hermes predicts the global average to reach 67 days by the end of this year. The annual review and forecast was ...
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Strategic Global Intelligence Brief for May 2, 2018

Short Items of Interest—U.S. Economy Wage Hikes Finally Showing Up It has taken an inordinately long time, but there is evidence at last that wages are going up at a pace commensurate with the growth of the overall economy—this could be worrisome. For the last few years, the pace of wage growth has been weak—no more than around 2.3% on an annual ba...
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Second of Four Predicted Rate Hikes Expected in June

With rising inflation underway, investors are anticipating yet another interest rate hike from the U.S. Federal Reserve in June—the second of as many as four increases that are predicted in 2018. The Fed's first lending rate increase came in March when it grew by a quarter percentage point from 1.5% to 1.75%, Reuters reported. Borrowing costs began...
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Tech Use Huge Factor in Banking Competition

The ability to keep up with the times may literally break the bank if financial institutions choose not to embrace the technological advancements in the sector, particularly as it relates to payments and lending. According to Moody's Investors Service, banks that are willing to tap into this digital innovation will establish and potentially maintai...
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ACH Continued Growth in 2017

The ACH Network continued to grow in 2017, posting more than a billion new payments for the third consecutive year. The Network processed 21.5 billion transactions valued at nearly $47 trillion last year, according to a recent release from NACHA—The Electronic Payments Association.  Transaction value grew by almost 6%, while its value increase...
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Canadian SMBs’ Lending Struggles Continue

Canadian investment in its small- to medium-sized businesses (SMBs) saw an uptick in February over the prior month, but the latest readings of small business credit data and analysis provider PayNet's lending index indicate an ongoing struggle and undefined future. PayNet released its February Canadian Small Business Lending Index results on April ...
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Contractors of DOT Projects Confront Credit Complications

Contractors on large Department of Transportation (DOT) projects could face credit complications in the foreseeable future in connection to minimal state revenue growth and federal funding, Fitch Ratings reported on April 13. State-level funding was often provided for such projects but has declined over the past few years, leaving contractors to se...
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India’s Economic Growth Increases Likelihood of ABS Loan Repayment

Credit managers conducting business in India have no need to worry when it comes to asset-backed securities (ABS), as Moody's Investors Services reports a "pick-up" in the country's economic growth, increasing the likelihood of loan repayment. India's economy grew 6.2% in 2017, with expectations even higher at 7.6% this year. As borrowers rake in a...
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Companies Debate Small Business Hiring Growth

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The cost-saving efforts of the U.S. tax reform are beginning to manifest in the small business market, as financial services and business consultant CBIZ, Inc. recorded a bump in its Small Business Employment Index (SBEI) in March. February's disappointing results of a slight decrease in hiring among small businesses was redeemed last month when th...
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American Bankruptcies Decline in 2018 1Q

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Bankruptcy filings are down in the U.S., according to the American Bankruptcy Institute (ABI). Its latest release reported first quarter bankruptcies declined 4% compared to the same time last year.According to ABI and data from Epiq Systems, there were more than 187,000 during the first quarter of 2018. There were more than 195,000 in 2017's first...
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China’s Payment Delays Growing

Credit managers might want to revisit their payment terms when it comes to extending credit in China. According to a recent report from credit insurer Coface, payment terms with Chinese businesses significantly increased in 2017, leaving risk managers "more complacent" in regards to their current expectations. On April 3, Coface released its China ...
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Emerging, Advanced Economies Show Similar Results in Corporate Default Rates

Corporate defaults come as no surprise in advanced economies, but a recently released Moody's Investors Service 20-year study found that the default numbers for emerging economies are quite similar to those in advanced economies after an in-depth review of more than 1,700 defaults in both markets around the world. The Moody's report, released on Ma...
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Oil Price Increase Raises Concerns of U.S. Supply Outlook

Rising prices coupled with growing tensions with the Middle East could threaten the U.S. oil supply, despite a substantial increase in global output. According to Reuters, oil prices were clocked at $70 a barrel this week—an increase of 7% in March and more than 5% overall in 2018. As the May deadline nears for the U.S. to decide whether it will wi...
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Current U.S. Tariffs Have Limited Impact on China's Economy, but That Could Change

With the U.S. administration's tariffs underway, the likelihood of a global trade war is becoming increasingly foreseeable to many economists and trade industry experts. However, Moody's Investors Service reported on March 22 that the current measures will only have a limited impact on China's economy. Unlike 10 years ago, Moody's reported, China i...
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PPP Program to Boost Argentine Infrastructure Investment

Infrastructure investment in Argentina has dwindled in recent years, but a new public-private partnership (PPP) program might give the country a much-needed boost over the next four years. The PPP program will feature a $26 billion investment beginning this year through 2022 for roads, energy and mining, communications, water, sanitation and housin...
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Rewritten Financial Reform Law Would Ease U.S. Small Bank Lending

The 2010 Dodd-Frank financial reform law giving the U.S. government regulation over the financial industry is headed toward a rewrite that would ease tight restrictions on small banks and community lenders. Following the U.S. Senate's vote to approve the revised bill on March 14, the legislation is making its way to the U.S. House of Representative...
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Reverse Factoring Accounting Errors Led to Carillion Collapse

Although reverse factoring is becoming an increasingly popular supply-chain finance option around the globe, proper accounting procedures should be in place throughout the process—an arrangement that fell short and may have caused the demise of U.K. construction giant Carillion, which collapsed in January. According to an article in Supply Chain Ma...
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Steel, Aluminum Import Tariffs Should Have ‘Limited’ Impact on Sector

With U.S. government plans in motion to impose tariffs on steel and aluminum imports, industries in the sector are left wondering what potential risks might be coming their way in regards to future business operations. A direct impact on the nation's steel and aluminum producers will most likely be "limited," said Fitch Ratings; however, retaliatio...
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