While other economic indicators remained strong, the December report of the Credit Managers’ Index (CMI) from the National Association of Credit Management (NACM) shows several categories with lows not seen since March 2014. Overall, the combined numbers for manufacturing and service sectors fell to 54.9, compared with 55.8 in November. “It would have been nice to end the year on a high note,” said Chris Kuehl, PhD, NACM economist.

Although durable goods orders were robust, employment numbers solid and retail sales better than many had expected, CMI data ended the year by falling over two consecutive months to its worst numbers since the start of 2014. “That is a real worry,” Kuehl said.

Although the combined Index of Favorable Factors slipped from 61.2 to 60.5 — the lowest result since March — the combined data is still comfortably high. The Sales category dropped from 62.7 to 61.4 — another low as compared with previous months. New Credit Applications improved, however, as it shifted from 58.1 to 59.2.

Most of the CMI’s bad news stems from the Index of Unfavorable Factors, helping to make 2015 a mystery to predict. The combined index dropped from 52.2 to 51.1, toward the low side of that reading over the course of the past year and close to contraction levels (below 50). Rejections of Credit Applications dropped, but only slightly from 51.7 to 51.5. Bigger credit offerings to a select few clients and more applications from less than creditworthy companies seem to be the pattern of late. Accounts Placed for Collection also slipped a little from 51.8 to 51.1.

The bigger issue, however, is that several readings are so close to the breakpoint between contraction and expansion. The category of Disputes took fell to 48.5, inside the contraction zone and at its lowest point in well over two years.

Filings for Bankruptcies actually improved from 56.5 to 58.5. “That is a decent sign of some progress as it suggests that the issues that have been affecting the creditors have not yet reached the point that companies are crashing and burning,” Kuehl noted.

To view the full NACM report, click here.