Confidence in the equipment finance market remained steady in December. The Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI), published by the Equipment Leasing and Finance Foundation (ELFF), was 42.5. The November index was 42.8.
The index measures current business conditions and forecasts for the equipment finance industry.
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“In the most recent survey, most opined that the markets would remain steady through early 2024 with very few signs anticipating dramatic changes in the next several months,” said Dave B. Fate, CEO, Stonebriar Commercial Finance, in a statement. “Subsequent economic reports over the past two weeks, including the Fed’s announcement that further rate hikes are no longer forecasted, with various institutions predicting multiple rate cuts throughout 2024, the first of which some predict as early as March–have caused major positive shifts in sentiment in the bond and equity markets the past two weeks. Equity markets have rallied to all-time highs, mortgage rates dropped below 7%, and overall market sentiment has improved significantly, which I expect will continue in the coming months.”
Only 3.7% of the executives surveyed expect their business conditions to improve over the next four months, up from none in November. Three in 10 (29.6%) said that they expect business conditions to worsen, an increase from 25.9% in November.
“Looking out to 2024, we expect sales of equipment and transportation to be softer,” said James D. Jenks, CEO, Global Finance and Leasing Services, in a statement.
None of the respondents evaluate the current U.S. economy as “excellent,” a decrease from 3.7% the previous month. The percentage evaluating it as “poor” remained unchanged at 14.8%.
Three in 10 (29.6%) said that they believe economic conditions in the U.S. will worsen over the next six months, a decrease from 51.9% the previous month. The percentage of respondents expecting condition to be “better” remained the same, at 3.7%.
