Investment in equipment and software in the US is expected to grow 4.4% in 2016, according to a report by the Equipment Leasing and Finance Foundation.
According to the foundation, the moderate growth forecast reflects economic crosswinds, as weakness in the global economy (particularly China), low commodity prices, and a strong dollar are diminishing businesses’ incentive to invest, while a strengthening U.S. economy and elevated propensity to finance should propel growth in the equipment finance sector.
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William G. Sutton, president of the foundation and president and chief executive officer of the Equipment Leasing and Finance Association, said: "Building on the forecast that the equipment finance industry will surpass the $1 trillion mark in 2015, this Outlook for 2016 projects decent, but not robust, equipment finance growth in the coming year. Navigating a changing marketplace, the equipment finance industry will adapt to economic and policy shifts as it always has — and will continue to find new opportunities for growth."
The report highlighted that negative global trends are expected to hurt certain equipment verticals, while signs of strength in the U.S. economy will fuel continued gains in others.
The ‘Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor’ projected that investment in software, computers, aircraft as well as ships and boats will grow over the next three to six months.
The monitor also found that investment in medical equipment is likely to stabilize, while investment in tracks to remain steady over the same period.
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By GlobalDataGrowth of investment in agriculture and material handling equipment was said to remain weak, while in construction and industrial equipment to slow.
Railroad equipment investment growth was projected to remain negative over the next three to six months, while mining and oilfield machinery investment growth ‘should remain strongly negative’ over the same period.
