U.S. business borrowing for equipment falls 2 percent in September: ELFA
Published Oct 25, 2018 03:17PM ET
U.S. business borrowing for equipment falls 2 percent in September: ELFA
(Reuters) - U.S. companies' borrowing to spend on capital investment fell 2 percent in September from a year earlier, a trade group representing capital equipment lenders said on Thursday.
The companies signed up for $8.5 billion in new loans, leases and lines of credit last month, down from $8.7 billion a year earlier, the Equipment Leasing and Finance Association (ELFA) said.
The decline in volume was likely a result of rising diesel prices, the impact of the dollar, lack of infrastructure stimulus, rising interest rates and tariffs, said Gary Peterson, chief executive of TCF Equipment Finance, which is an ELFA member.
Washington-based ELFA, which reports economic activity for the $1 trillion equipment finance sector, said credit approvals were 75.7 percent in September, down from 76.4 percent in August.
ELFA's leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the U.S. Commerce Department's durable goods orders report, which it typically precedes by a few days.
ELFA's index is based on a survey of 25 members that include Bank of America Corp (N:BAC), BB&T Corp (N:BBT), CIT Group Inc (N:CIT) and the financing affiliates or units of Caterpillar Inc (N:CAT), Deere & Co (N:DE), Verizon Communications Inc (N:VZ), Siemens AG (DE:SIEGn), Canon Inc (T:7751) and Volvo AB (ST:VOLVb).
The Equipment Leasing & Finance Foundation, ELFA's non-profit affiliate, said its confidence index for October is 63.2, down from the September index of 65.5.
A reading of above 50 indicates a positive outlook.
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Written By: Reuters
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