The Equipment Leasing & Finance Foundation released its monthly confidence index for the March 2019, showing the second straight month of upward movement in the numbers. The Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) hit 60.4, up from February’s 56.7.
The index is developed from a regular survey of finance industry executives, from banks of all sizes, as well as captive equipment finance companies and independents. Integrity of the survey is maintained by circling back to the same 50 leaders every month.
In the index, 20 percent of the respondents felt business conditions will improved over the course of the next four months, a significant increase from the 10 percent who offered the same assessment in February. Most of that movement is attributable to a similarly sizable decrease in the respondents predicting stasis, down from 83.3 percent to 70 percent. Only 10 percent of executives believe business conditions will worsen.
Also of note in the new index, nearly a quarter of survey respondents think there will be an increase in demand for capital expenditure leases and loans in the near future (23.3 percent, up from 13.3 percent in February).
There was also a surge in respondents planning to increase company workforce, with 46.7 percent indicating plans to hire more employees during the next four months. In February, 26.7 percent foresaw an increase in personnel.
The assessment of the current U.S. economy remains remarkably stable: 36.7 percent rate the economy as “excellent,” 63.3 percent say it is “fair,” and none deem it “poor.” It’s the third straight month the numbers have settled there.
Although the MCI-EFI currently reflects a positive outlook, the commentary of respondents suggests many are keeping an eye on new home construction, which has shown some volatility in recent months.
“I'm optimistic that companies in general have ample cash and access to capital to withstand any softening of demand,” noted Quentin Cote, CLFD, president of Mintaka Financial. “I'm concerned about the softening housing market and the negative impact it may have on small business sentiment.”