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U.S. business borrowing for equipment fell 3% in December

by Mike Robinson

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© Reuters. FILEPHOTO: This illustration, taken November 23rd 2021 shows an American one-dollar banknote. REUTERS/Murad Sezer/Illustration/File Photo

(Reuters) – U.S. businesses borrowed 3% less December in order to finance equipment investments, according to the Equipment Leasing and Finance Association. This was due in part, ELFA stated on Tuesday.

Firms signed up last month for $11.8 million in loans, leases, or lines of credit, as opposed to $12.1 billion one year prior. The number of borrowings increased 49% over November.

The outlook for the sector and the economy is uncertain, due to unabated inflation, Fed poised increase interest rates, equities market in a recent tailspin,” Ralph Petta, Chief Executive Officer of ELFA, stated in a statement. He also said that Omicron coronavirus remains a problem in the United States.

ELFA reported that credit approvals fell to 78.6% in November from 77.2%.

This Washington-based organization’s financing and leasing index tracks the amount of American commercial equipment that has been financed.

This index was compiled from a survey of 25 members including Bank of America Corp (NYSE :), CIT Group(NYSE 🙂 Inc, and any financing affiliates. Caterpillar Inc (NYSE -), Dell Technologies (NYSE –) Inc, Siemens AG (OTC ) Canon Inc and Volvo AB AB (OTC )

The Equipment Leasing & Finance Foundation, ELFA’s non-profit affiliate, said its confidence index for January was at 63.9%, unchanged from December. If the reading is above 50, it indicates that there are positive business perspectives.

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