| April 2
April 2 Small U.S. businesses cut back on
borrowing in February for a second straight month, hinting at
slower growth ahead even as other economic data shows the
recovery picked up in the early part of the year.
The Thomson Reuters/PayNet Small Business Lending Index,
which measures the overall volume of financing to small U.S.
companies, fell to 101.3 from a downwardly revised 111.7 in
January, PayNet said on Tuesday.
PayNet's lending index typically correlates to overall
economic growth one or two quarters in the future.
The U.S. Federal Reserve last September moved to push down
long-term borrowing costs with a third round of asset purchases,
pledging to keep buying until the labor market improves
That stimulus, coupled with rock-bottom short-term interest
rates since December 2008, has done little to get smaller U.S.
firms to expand, the index shows.
"They don't have a conviction that they should go all in,"
PayNet founder Bill Phelan said in an interview. Without that
conviction, small businesses are not expanding quickly, and are
not as apt to hire.
The data provides a counterpart to generally positive
signals from the broader economy, including a rise in consumer
spending and sentiment, and at least some signs of strength at
But small business borrowing grew just 2 percent from a year
earlier, the index showed, the slowest year-on-year increase
since September. PayNet had initially reported the January
figure at 113.1.
Perhaps more telling are early signs that financial stress
Trucking companies, whose behavior historically has led that
of other small businesses, are having more trouble paying back
Delinquencies of 31 to 180 days among transportation service
and warehouses companies rose to 1.85 percent in February, up
from an all-time low of 1.55 percent last August, Phelan said.
Delinquencies in other sectors are down. Overall, accounts
overdue by one to six months slid to 1.58 percent from 1.62
percent of all loans made.
PayNet collects real-time loan information, such as
originations and delinquencies, from more than 250 leading U.S.