An index measuring confidence in the equipment finance industry dropped to 72.1 in May from 76.1 in April, its all-time high.
The Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) is released by the Equipment Leasing & Finance Foundation as an indicator of both the prevailing business conditions and expectations for the future.
“While vaccine ‘herd immunity’ may be unachievable, warmer weather, immunity provided by previous infections and over 105 million Americans fully vaccinated will allow most economic activity to resume at pre-pandemic levels this summer,” said Bruce J. Winter, President, FSG Capital, in his response. “Business owners are much more optimistic and stimulus supported capital spending will likely reach unprecedented levels in the next 12 months. Prolonged inflation risk is a real concern as this untested experiment in rapidly expanding government debt will reach new highs.”
When asked to assess their business conditions over the next four months, 53.6 percent of executives responding said they believe business conditions will improve, down from 73.3 percent in April. The remaining 46.4 percent said they believe business conditions will remain the same over the next four months, up from 23.3 percent the previous month.
As far as demand for leases and loans to fund capital expenditures, 53.6 percent said they believe demand will increase over the next four months, down from 70 percent in April. The remaining 46.4 percent said they believe demand will “remain the same” during the same four-month time period, an increase from 30% the previous month.
When asked about the state of the current U.S. economy, 10.7 percent described it as “excellent,” a decrease from 13.3 percent the previous month. “Fair” was chosen by 89.3 percent of respondents, up from 80 perccent in April, and none evaluated it as “poor,” down from 6.7 percent last month.
Looking forward, 60.7 percent of the survey respondents said they believe that U.S. economic conditions will get “better” over the next six months, a decrease from 73.3 percent in April. The remaining 39.3 percent said they believe the U.S. economy will “stay the same,” an increase from 23.3 percent last month.
Source: Equipment Leasing & Finance Foundation
