Borrowings by U.S. firms for capital investment increased 12 percent in September from a year previously, the Equipment Leasing and Finance Association (ELFA) stated.
Companies registered for $9.4 billion in new loans, leases and credit lines last month, said the Washington-based trade group, which reports economic activity for the $1 trillion U.S. equipment finance market.
The U.S. Federal Reserve’s choice to keep interest rates low has actually spurred companies to invest more on devices, ELFA President Ralph Petta stated.
However, overall new borrowings in the very first nine months of the year fell 4 percent, ELFA stated.
In September, credit approvals fell to 76.6 percent of all applications sent from 76.9 percent in August, ELFA stated.
There is pent up need for capital investment, however provided the unpredictable domestic environment and the economic headwinds internationally, the disproportion may last for a number of months, stated Stan Walker, handling director of JPMorgan Equipment Finance.
ELFA’s leasing and finance index tracks the volume of business equipment funded in the United States. The index matches the United States Commerce Department’s durable goods orders report, which it precedes by some days.
The index is based on a study of 25 loan providers, including Bank of America Corp, BB&T Corp, CIT Group Inc and the funding affiliates or units of Caterpillar Inc, Deere & Co, Siemens AG and Volvo AB.
Independently, the Equipments Leasing & Finance Foundation, ELFA’s non-profit affiliate, stated its confidence index increased to 56.0 for October from 53.8 for September.