According to a new article published in the Journal of Equipment Lease Financing, the peer-reviewed publication of the Equipment Leasing & Finance Foundation, the equipment leasing and finance industry will likely feel significant effects from rising inflation and the Fed’s actions to fight it. The article, “Higher Inflation, Rising Interest Rates and New Challenges and Opportunities for the Equipment Finance Industry,” was authored by Robert Wescott, Ph.D., Desmond Dahlberg and Julie Coen of Keybridge Research.

The article, which draws from economic data and input from equipment finance industry veterans, has three main sections that examine the sources of the surge in inflation and where inflation is likely to head in the next couple of years, likely movements in interest rates as the Fed tries to re-assert control over inflation and what rising interest rates are likely to mean for the equipment finance industry. It looked at structural changes likely to impact the industry, likely shifts in end-user markets for equipment and opportunities for new types of financing products that may match changing customer risk profiles.

“The industry veterans interviewed expressed confidence that equipment finance firms will continue to innovate and succeed in this new era of high inflation and rapidly rising interest rates,” Tom Ware, committee chair for research for the ELFF, said. “Finding new opportunities to grow their businesses by designing and offering new products that help their customers manage their risks better is something the industry has a proven track record of doing.”