NACM Credit Manager?s Index For February Indicates Economic Expansion

Columbia, MD – While the manufacturing sector exhibited significant gains?the single largest increase since March 2003?the service sector showed modest growth, compared to January results. Favorable factors within both sectors exhibited economic expansion.

Manufacturing Sector Results
The manufacturing sector recorded a 510 basis point improvement in February. This is the single largest increase since March 2003. New credit applications and new sales lead the way with increases of 1,420 and 1,330 basis points, respectively. However, rejection of credit applications appears to be growing?the only negative factor.

Service Sector Results
The service sector showed slight improvement in February, increasing 80 basis points. Like the manufacturing sector, new credit applications and new sales contributed to the increase. Returning to November 2004 levels, all factors exhibit economic growth.

Comparison of February 2005 to February 2004
In a year-to-year comparison, we find that half of the factors show positive or level growth. Within the manufacturing sector seven of the 10 factors show positive growth, while the service sector, nine of the 10 show some erosion.

Methodology Appendix
The CMI data has been collected and tabulated monthly since February 2002. The index, published since January 2003, is based on a survey of about 500 trade credit managers during the last 10 days of the month, with about equal representation between manufacturing and service sectors. The survey asks respondents to comment on whether they are seeing improvement, deterioration, or no change for various favorable or unfavorable factors. There is representation from all States, except some of the less populated such as Vermont and Idaho.

For this complete release, please visit http://www.nacm.org/resource/press_release/pressFeb05.html.