(Reuters) - Borrowing by U.S. companies to spend on capital investment rose last month, the Equipment Leasing and Finance Association (ELFA) said on Tuesday.
Companies signed up for $8.9 billion in new loans, leases and lines of credit in March, up 10 percent from a year earlier. Their borrowing rose 51 percent from February.
"The central bank's recent rate hike may, in part, be responsible for the spike in equipment demand as businesses seek to lock in fixed rate financing ahead of steadily increasing interest costs," ELFA Chief Executive Ralph Petta said in a statement.
Washington-based ELFA, a trade association that reports economic activity for the $1 trillion equipment finance sector, said credit approvals totaled 74.5 percent in March, down slightly from 74.8 percent in February.
ELFA's leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the U.S. Commerce Department's durable goods orders report, which it typically precedes by a few days.
ELFA's index is based on a survey of 25 members that include Bank of America Corp (BAC.N), BB&T Corp (BBT.N), CIT Group Inc (CIT.N) and the financing affiliates or subsidiaries of Caterpillar Inc (CAT.N), Deere & Co (DE.N), Verizon Communications Inc (VZ.N), Siemens AG (SIEGn.DE), Canon Inc (7751.T) and Volvo AB (VOLVb.ST).
The Equipment Leasing & Finance Foundation, ELFA's non-profit affiliate, said its confidence index fell to 65.8 in April from 71.1 in March.
A reading of above 50 indicates a positive outlook.
Reporting by Radhika Rukmangadhan in Bengaluru; Editing by Sai Sachin Ravikumar