ELFF Predicts U.S. Economy Will Grow by 2.3%, 2024 Recession Unlikely

JUL 26, 2024 - 6:19 am

The Equipment Leasing & Finance Foundation has released the Q3/24 Equipment Leasing & Finance Industry Snapshot, a slide deck that summarizes the current conditions and projections for the U.S. economy and equipment finance industry.

Among the wide range of details in the Q3/24 snapshot:

The Foundation projects that the U.S. economy will grow by 2.3%.
- The U.S. economy had another quarter of growth in Q1/24. Consumer spending, business and residential investment and government spending drove the expansion, while inventories and trade were net drags.
- Overall, a recession in 2024 remains unlikely, with economist placing the odds of a soft landing (60% – 70%) above that of a hard landing. However, a return to strong economic growth is also unlikely.
Economic tailwinds: Q1/24 growth was primarily driven by consumer spending, supported by a boost in government spending and business and residential investment.
Economic headwinds include negative growth in private inventories and net exports.
Equipment and software investment is expected to grow at a 3.7% annualized pace in 2024.
- E&S investment accelerated in Q1/24, rising 5.1% (annualized) after growing 3.2% in Q4/24. Elevated interest rates will continue to drag on investment in 2024, and the climate for near-term investment is still modest.
- Business investment grew in Q1/24, rising 4.4% (annualized). Growth accelerated from 3.7% in the previous quarter.
By equipment type, investment growth in the coming six months appears set to:
- Expand in software and computers.
- Decline in medical and mining & oilfield.
New business volume growth reported in ELFA’s Monthly Leasing and Finance Index was down 4% year-over-year in June but remains up 4.1% year-to-date, laying the foundation for healthy, positive growth in 2024.