The Equipment Leasing & Finance Foundation (the Foundation) releases the November 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI). The index reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $1 trillion equipment finance sector. Overall, confidence in the equipment finance market is 43.7, a decrease from the October index of 45.
"There continues to be uncertainty in the markets as a result of inflationary pressures, rising rates, and the unknown impact of mid-term elections. Due to ongoing challenges from supply chain delays, we are seeing increased demand for used equipment,” says MCI-EFI survey respondent Aylin Cankardes, president, Rockwell Financial Group, in a press release from the Foundation. “Overall, our customers have been very resilient and underlying growth has been robust so we anticipate a strong finish to 2022, particularly in the energy transition and sustainability finance sector.”
When asked to assess their business conditions over the next four months, none of the executives responding said they believe business conditions will improve over the next four months, unchanged from October. According to the Foundation, 46.4% believe business conditions will remain the same over the next four months, down from 62.5% the previous month; and 53.6% believe business conditions will worsen, an increase from 37.5% in October.
“Despite the economic headwinds and rising interest rates there will still be decent demand as equipment that has aged due to supply chain constraints will need to be replaced. We are concerned how the rising costs of borrowing combined with a softening economy will impact some of our leveraged borrowers,” says Chris Lerma, president, AP Equipment Financing.
Read the press release at: www.leasefoundation.org
