U.S. small businesses boosted borrowing in September, an index released on Monday showed, a sign that more firms are betting on an increase in household spending in the coming months.
The Thomson Reuters/PayNet Small Business Lending Index increased to 140.4 in September from a downwardly revised reading of 135.6 reading in August. It was up 11 percent from a year earlier, led by firms borrowing in the transportation, warehousing, construction, accommodation, food, healthcare and real estate industries.
"It's consumer, consumer, consumer," said Bill Phelan, President of PayNet. "This above-average growth trend means that small business is going to deliver material amounts of growth to GDP in the fourth quarter."
The index, which hit a record in June, has historically tracked ahead of U.S. gross domestic product growth by two to five months.
U.S. GDP growth cooled to a 1.5 percent annual pace last quarter, although consumer spending was a bright spot.
The Federal Reserve said last week it will decide whether to raise rates in December based on actual and projected progress toward its goals of 2-percent inflation and full employment.
Many officials see economic growth of 2 percent or more as strong enough to bring the unemployment rate, now at 5.1 percent, down further.
The Atlanta Fed currently forecasts U.S. growth of about 2.5 percent in the current quarter.
The delinquency rate on loans more than 30 days past due ticked up to 1.45 percent in September from 1.44 percent the prior month, separate data from PayNet showed.
PayNet collects real-time loan information such as originations and delinquencies from more than 250 leading U.S. lenders.
(Reporting by Ann Saphir, editing by G Crosse)