In its October confidence index, the Equipment Leasing & Finance Foundation reported that confidence in the equipment finance market is 56.0, an increase from the September index of 53.8 and the highest level since April despite continued concerns about the November elections.

When asked about the outlook for the future, MCI-EFI survey respondent Frank Campagna, commercial equipment finance business line manager for M&T Bank Corporation, said, “We continue to see strong demand from our core commercial and industrial business throughout all regions of our footprint and via all finance product sets and asset classes. Our business optimism is tempered somewhat by the continued downward price pressure by some of our competitors, but that does not discount the fact that our customers are in the market and acquiring equipment. Some sectors related to infrastructure, albeit softer than in years past—especially those related to energy—continue to provide equipment financing opportunity and are poised for some significant growth in 2017.”

When asked to assess their business conditions over the next four months, 12.1% of executives said they believe business conditions will improve over the next four months, a decrease from 18.8% in September.  However, fewer 6.1% believe business conditions will worsen with 6.1% indicating so, a decrease from 18.8% the previous month.

There was a slight dip in the number of survey respondents who believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months (24.2%), after a 28.1% reading in September. There was little difference in the number who believe demand will decline, with the 18.2% reading in October just below the 18.8% recorded in September.

“Demand seems constant as businesses begin to wrap up their equipment acquisition plans for 2016. The elephant in the room is the elections. I believe the issues that are not being addressed may have significant ramifications for small to mid-size businesses in 2017. It is too early to tell, but the political climate is not adding to anyone’s confidence levels.” Valerie Hayes Jester, president, Brandywine Capital Associates.

There was a nice uptick in expectations for more access to capital to fund equipment acquisitions, with 18.2% indicating such an expectation after no respondents did so in September. However, smaller and medium-sized businesses may be holding off partially due to the November elections.

“The uncertain political environment seems to be causing some of the smaller medium size businesses to delay equipment purchases. Hopefully, this will change after the elections,” said William H. Besgen, senior advisor and vice chairman emeritus of Hitachi Capital America, echoing a sentiment expressed by a number of respondents.

When asked, 30.3% of the executives report they expect to hire more employees over the next four months, an increase from 21.9% in September. However, 9.1% expect to hire fewer employees, up from 6.3% in September.

None of the leadership evaluated the current U.S. economy as excellent, which is unchanged from last month. Once again the large majority rate it as fair (93.9%).

Expectations for future economic conditions seem optimistic with 15.2% of the survey respondents saying they believe that U.S. economic conditions will get better over the next six months, an increase from 6.3% in September.

In October, 36.4% of respondents indicate they believe their company will increase spending on business development activities during the next six months, a decrease from 40.6% in September. However, no respondents believe there will be a decrease in spending, a decrease from 6.3% who believed so last month.