U.S. business borrowing for equipment falls 17 percent in July - ELFA

Equipment stored at the Machinery Auctioneers lot for an upcoming auction in Odessa, Texas June 4, 2015. REUTERS/Cooper Neill

(Reuters) - Borrowings by U.S. companies for capital investment in July fell 17 percent from a year earlier, the Equipment Leasing and Finance Association (ELFA) said.

Companies signed up for $7 billion in new loans, leases and lines of credit last month, the Washington-based trade group said on Monday.

In the first seven months of 2016, total new borrowings declined 8 percent from a year earlier, said ELFA, which reports economic activity for the $1 trillion U.S. equipment finance industry.

“As the presidential campaign moves into higher gear, it appears business owners continue their wait-and-see attitude toward investment in and expansion of their business operations,” ELFA Chief Executive Ralph Petta said in a statement.

In July, credit approvals fell to 75.9 percent of all applications submitted from 78.1 percent in June, ELFA said.

ELFA’s leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the U.S. Commerce Department’s durable goods orders report, which it precedes by a few days.

The index is based on a survey of 25 lenders that include Bank of America Corp, BB&T Corp, CIT Group Inc and the financing affiliates or units of Caterpillar Inc, Deere & Co, Siemens AG and Volvo AB.

The Equipment Leasing & Finance Foundation, ELFA’s non-profit affiliate, said its confidence index rose to 54.8 in August from 52.5 in July.

The index is an indicator of the outlook for the equipment finance market and a reading of above 50 suggests a positive outlook.

Reporting by Shalom Aarons in Bengaluru; Editing by Kirti Pandey