Confidence in the equipment finance market remains steady in February, according to the index provider, the Equipment Leasing & Finance Foundation (ELFF). The Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) was 58.7 in February, down from 59.9 in January.
The index reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $900 billion equipment finance sector, according to ELFF.
“Thankfully, the economy seems to have ignored the political wrangling in Washington,” said respondent Adam Warner, president of Key Equipment Finance, in a prepared statement. “We are hopeful, both personally and professionally, that the coronavirus can be effectively managed globally.”
When asked to assess their business conditions over the next four months, 11.5 percent of respondents said they believe business conditions will improve over the next four months, down from 14.8 percent in January. About 85 percent of respondents believe business conditions will remain the same over the next four months, an increase from 81.5 percent the previous month. About 4 percent believe business conditions will worsen, unchanged in January.
Demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, according to 7.7 percent of respondents, down from 11.1 percent in January. Almost 90 percent believe demand will “remain the same” during the same four-month time period, an increase from 85.2 percent the previous month. Four percent believe demand will decline, unchanged from January.
About one in five of the respondents expect more access to capital to fund equipment acquisitions over the next four months, an increase from 11.1 percent in January. Three-quarters of executives indicate they expect the “same” access to capital to fund business, a decrease from 85.2 percent last month. Four percent expect “less” access to capital, unchanged from the previous month.
About 38 percent of responded called the current U.S. economy “excellent,” up from 37 percent the previous month. About 61 percent evaluate the current U.S. economy as “fair,” down from 63 percent in January. None evaluates it as “poor,” unchanged from last month.
Four percent of respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 13.3 percent in January. About 88 percent indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 80 percent last month. Eight percent believe economic conditions in the U.S. will worsen over the next six months, up from 6.7 percent the previous month.