WASHINGTON, April 15, 2020 (GLOBE NEWSWIRE) -- Owing to the substantial uncertainty stemming from both COVID-19 and the impact of social distancing measures on the U.S. economy, investment in equipment and software is projected to contract severely in 2020, to between -8.6 and -13.5 percent. Similarly, the U.S. economy is expected to have its worst year in decades, with annual growth slowing to between -5.0 and -9.4 percent according to the Q2 update to the 2020 Equipment Leasing & Finance U.S. Economic Outlook released today by the Equipment Leasing & Finance Foundation. While the economy will continue to suffer until the public health crisis is resolved, conditions are expected to improve in the third and fourth quarters, which should produce strong annualized growth rates after a large contraction during the first half of the year. Nonetheless, the economy will be smaller at the end of 2020 than it was at the start.
Scott Thacker, Foundation Chair and Chief Executive Officer of Ivory Consulting Corporation, said, “This edition of the U.S. Economic Outlook clearly shows the COVID-19 impact on the economy. The report portrays in detail how 2020 is likely to be one of the most challenging years in history for the U.S. economy and for our industry. Going into 2020, equipment and software investment was already at its weakest growth level since 2016, and now is expected to plunge to nearly unprecedented low levels of growth. There are a few equipment verticals, however, such as medical devices and computers, that are expected to be more resilient.”
The Q2 update has been redesigned for a more comprehensive and reader-friendly format. Highlights from the report include:
The Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor, which is released in conjunction with the Economic Outlook, tracks 12 equipment and software investment verticals. In addition, the Momentum Monitor Sector Matrix provides a customized data visualization of current values of each of the 12 verticals based on recent momentum and historical strength. Most equipment verticals will face a difficult investment environment in 2020, though select industries may experience a boost. Over the next three to six months:
The full report of the Momentum Monitor is now available at https://www.leasefoundation.org/industry-resources/momentum-monitor/.
The Foundation produces the Equipment Leasing & Finance U.S. Economic Outlook report in partnership with economic and public policy consulting firm Keybridge Research. The annual economic forecast provides the U.S. macroeconomic outlook, credit market conditions, and key economic indicators. The Q2 report is the first update to the 2020 Economic Outlook and will be followed by two more quarterly updates before the publication of the 2021 Economic Outlook in December.
Download the Q2 update report at https://www.leasefoundation.org/industry-resources/u-s-economic-outlook/. All Foundation studies are available for free download from the Foundation’s online library at http://store.leasefoundation.org/.
A free webinar sponsored by the Foundation and the Equipment Leasing and Finance Association, “Coronavirus and the U.S. Economy: Implications for the Equipment Finance Industry,” will be presented on Wednesday, April 15 at 1 p.m. ET. Economists Dr. Robert Wescott and Jeff Jensen of Keybridge will discuss the state of the economy and the equipment finance industry in the face of the global pandemic. For details and to register visit www.elfaonline.org/events/2020/WW041520
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The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through individual and corporate donations. Learn more at www.leasefoundation.org.
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