The Equipment Leasing & Finance Foundation has released the Q2 2022 Equipment Leasing & Finance Industry Snapshot, an indispensable information resource for industry participants. Designed for use in executive briefings and presentations, the presentation slide deck summarizes the current conditions and projections for the U.S. economy and equipment finance industry with clear, easy-to-digest charts and short narratives of key trends.
Among the range of details in the new release:
• Overall, the Foundation projects the U.S. economy will grow by 2.8 percent in 2022. Growth will likely be driven by a gradual unraveling of supply chains, business investment and continued consumer spending.
o The U.S. economy expanded to a 6.9 percent annualized pace in Q4 2021, with most of the expansion due to a buildup in inventories.
• Economic tailwinds for growth this year include:
o A robust labor market with plentiful job openings and strong wage growth in several industries, which is providing consumers with support in the face of high inflation, falling savings, and geopolitical uncertainties.
o A healthy housing market driven by strong demand and limited inventories.
• Economic headwinds include:
o Worsening inflation pressures which are expected to remain high in the near term.
o New challenges to supply chains, already strained by the pandemic, due to Russia’s invasion of Ukraine and COVID-related lockdowns in key Chinese industrial cities.
• Additional factors to watch include:
o Stagflation due to persistently high inflation and expectations for slowing growth this year.
o Action by the Federal Reserve to tamp down inflation by raising interest rates without causing a recession.
o Geopolitical fallout of the Russian war in terms of global trade impacts, and the possibility of future conflicts (e.g., China and Taiwan).
• Equipment and software investment is expected to recover over 2022 as business conditions stabilize following volatility caused by geopolitical tensions. Equipment and software investment is projected to expand by 4.2 percent, a slower pace than in 2021, which was the strongest year in a decade.
• New business volume growth reported in ELFA’s Monthly Leasing and Finance Index eased in Q1 after a record year in 2021. It expanded 4 percent year over year in February. Healthy business investment growth is expected to drive new business volume growth throughout 2022, though year-over-year growth may ease compared to the double-digit expansion last year.
Prepared by Keybridge Research and updated quarterly, the snapshot is available for free download at https://www.leasefoundation.org/industry-resources/industry-snapshot