According to the Equipment Leasing and Finance Foundation, business investments in equipment and software are projected to increase by 4.1% in 2019. Driven by more preferable tax treatment and a general upswing in the U.S. economy, investment levels were robust in 2018 and should continue in the short term.
However, growth slowed in the third quarter and could lead to a weaker starting point in the new year. Some highlights from the report include:
- Credit market conditions remain healthy, with an increase in the supply of credit in the third quarter and subdued financial stress levels, though demand for credit declined.
- The U.S. economy accelerated in 2018, spurred by stronger growth in business investment, a historically healthy labor market, lower tax rates, and increased government spending. Consumers have been the main driver of growth over the past year, and near-record consumer confidence should keep spending levels elevated through at least the first half of 2019.
- Looking at specific markets, marine vessels, railroad equipment, material handling equipment, aircraft, and construction machinery are poised for the most growth, with higher levels of equipment and software investments.
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