U.S. business borrowing for equipment rises 9% in July - ELFA

(Reuters) - Borrowings by U.S. companies for capital investments rose 9% in July from a year earlier, the Equipment Leasing and Finance Association (ELFA) said on Monday.

The companies signed up for $9.9 billion in new loans, leases and lines of credit last month, up from $9.1 billion a year earlier. However, borrowings fell 5% from the previous month.

“Despite supply chain disruptions in some sectors of the economy, signs of inflation, and the emergence of the Delta coronavirus, July new business volume in the equipment finance industry is strong,” ELFA Chief Executive Officer Ralph Petta said in a statement.

Petta also cited a pick-up in consumer spending and slowing unemployment as reasons to be optimistic about equipment investment and industry performance for the second half of the year.

Washington-based ELFA, which reports economic activity for the nearly $1-trillion equipment finance sector, said credit approvals totaled 76.5%, down from 76.7% in June.

ELFA’s leasing and finance index measures the volume of commercial equipment financed in the United States.

The index is based on a survey of 25 members, including Bank of America Corp, CIT Group Inc and the financing affiliates or units of Caterpillar Inc, Dell Technologies Inc, Siemens AG, Canon Inc and Volvo AB.

The Equipment Leasing and Finance Foundation, ELFA’s non-profit affiliate, reported a monthly confidence index of 66.6 in August, down from 72.9 in July.

A reading above 50 indicates a positive business outlook.

Reporting by Nathan Gomes in Bengaluru; Editing by Ramakrishnan M.