2021 Economic Outlook Forecasts

Jan 1, 2021

Looking forward to 2021!!!  Here is an article from globalnewswire.com that we wanted to share: 

WASHINGTON, Dec. 16, 2020 (GLOBE NEWSWIRE) — Equipment and software investment growth fared better than overall GDP growth in 2020 as businesses invested to adapt to the COVID-19 pandemic, and growth should remain well into positive territory in the beginning of 2021. Annual equipment and software investment growth of 7.8 percent is forecast for 2021. Annual U.S. GDP growth for 2021 is forecast at 4.7 percent, according to the 2021 Equipment Leasing & Finance U.S. Economic Outlook released today by the Equipment Leasing & Finance Foundation.

Scott Thacker, Foundation Chair and Chief Executive Officer of Ivory Consulting Corporation, said, “This update, while reflecting widely disparate performance in various segments of the economy, indicates the worst of the economic downturn appears to be in the rearview mirror — although that does not mean the road ahead is clear. Equipment and software investment surged to an annualized rate of 47 percent in Q3 after an unprecedented 28 percent decline in Q2. In Q3, investment levels in 11 of the 12 equipment verticals that the Foundation monitors improved and nine experienced double or triple-digit growth. Prospects of widely-distributed vaccines in 2021 should provide a boost to the economy, particularly in transportation-focused industries.”

Highlights from the 2021 Outlook include:

  • While equipment and software investment is forecast to grow 7.8 percent (annualized) in 2021, some industries will likely continue to struggle under the weight of the pandemic until a vaccine is widely available.
  • The U.S. economy expanded at an unprecedented 33.1 percent (revised) annualized rate in Q3 as the nation partially reopened. However, GDP is still well below its level at the end of 2019, underscoring the long road ahead to a full recovery.
  • The U.S. manufacturing sector recovery continued in late 2020. Shipments and new orders of core capital goods rose to record levels as firms in several industries responded to elevated demand. Though output is relatively close to pre-pandemic levels, manufacturing employment remains significantly depressed.
  • On Main Street, the fragile equilibrium of the late summer and early fall faces another serious threat this winter. Record COVID cases and deaths have forced several major cities to impose new lockdowns, and the effects are beginning to show. Small business revenues are falling while Main Street awaits the vaccine and another targeted federal relief effort.
  • The Federal Reserve remains committed to keeping interest rates at or near zero for several years. The Fed also intends to continue its liquidity-boosting measures, though its officials have stated that monetary policy alone is likely insufficient to prop up the U.S. economy.

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. Momentum readings are below the five-year average in six of 12 verticals, and all 12 verticals are accelerating. Over the next three to six months, year over year:

  • Agriculture machinery investment growth will accelerate.
  • Construction machinery investment growth should rebound.
  • Materials handling equipment investment should return to positive growth.
  • All other industrial equipment investment growth should experience a strong resurgence.
  • Medical equipment investment growth should continue to strengthen.
  • Mining and oilfield machinery investment growth should improve from current levels but may remain in negative territory.
  • Aircraft investment growth appears to have bottomed out earlier in the year and should improve, but is likely to remain in negative territory.
  • Ships and boats investment growth should turn positive.
  • Railroad equipment investment growth should strengthen.
  • Trucks investment growth appears likely to rebound after bottoming out in Q2.
  • Computers investment growth should remain robust and may strengthen further.
  • Software investment growth should improve.

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 report will be updated quarterly throughout 2021.

Download the full 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/.

Contact Hardedge Tool for all of your Industrial Razor Blade, Converting Blades and Film Slitting Blade needs!  (859) 581-0770 FAX: (859) 581-0776