For the second time in three months, a survey of companies’ credit managers has flashed a disconcerting message about the economy.
An index generated from the managers’ outlooks dropped in November to “levels not seen since February and March,” when the economy contracted for three months, said a report from the National Association of Credit Management, which does the surveys.
The surveys include information about credit applications, credit collections and credit extension involving businesses.
November’s weaker reading followed a stronger one in October and a weak one in September.
“The main question at the end of last month was whether the readings in September were anomalous or were October’s out of sync? It now appears that the October numbers were the odd ones, and that changes the expectations for the rest of the year,” economist Chris Kuehl said in the association’s report.
Although November’s index was weaker, it remained in a range that suggests growth continues. Kuehl said, however, that more of the pieces that make up the overall score had slipped to levels suggesting economic contraction.
“The roller coaster ride is obviously far from over,” Kuehl said in the report. “Last month was showing gains that had many expecting a robust end to the year. Suddenly, that is all in flux again.”
The index in November was 55.8, below October’s 57 and near September’s 54.9. A reading above 50 indicates economic expansion. Below 50 indicates a contraction.