Despite rising interest rates and enhanced macroeconomic uncertainty related to recent developments in the broader banking system, new business volume in the first quarter held strong, with cumulative year to date new business volume up 4% as compared to 2022. Industry leaders are impressed with the resilience of the equipment finance sector, which stands to benefit from the unique opportunity of assisting financially pressured customers with liquidity preservation. Inflationary pressures and concerns about the Federal Reserve’s future monetary policy actions remain material industry headwinds. We expect a dampening in industry confidence and data in Q2 as a result of continued bank failures and uncertainty in markets.
The Equipment Leasing & Finance Foundation measures confidence among industry leaders every month. Following a decline over the course of 2022, sector confidence among industry leaders bottomed out in November at 43.7. Sector confidence steadily improved over the following four months, with the index reaching 51.8 in February 2023. This brief trend reversed in March, as the index registered a value of 50.3, representing a 2.9% decline from the prior month.