NEMA Current Conditions Index Slips Into Contraction Territory in September

The NEMA Electroindustry Business Conditions Index (EBCI) for current conditions slipped to 46.4 points in September 2018, the first time since September 2016 that the current conditions component dipped below 50. With the exception of a one-month blip in June, the current conditions measure has been generally trending down since February of this year.

The EBCI is a monthly survey of senior executives at electrical manufacturers published by the National Electrical Manufacturers Association (NEMA), Rosslyn, VA. Any score over the 50-point level indicates a greater number of panelists see conditions improving than see them deteriorating.

Although half of the panel reported unchanged conditions, the share of those noting worse conditions increased by 10 percentage points from August’s results. Comments were mixed, with one mentioning transportation bottlenecks as a limiting factor.

Marginal erosion in the future conditions component to 46.4 points left its September score below 50 for the second straight month. Unlike the current component, the view six months ahead appears to be flattening rather than contracting further, as the proportion of respondents noting unchanged conditions surged by 31 points to 50 percent in September. Qualitative remarks were limited, but pointed to increased export opportunities as well as possible improvement once the noise from the election cycle has quieted.