Small-business borrowing falls in June
CHICAGO |
CHICAGO (Reuters) – Lending to small businesses fell in June to the lowest level since October, a report showed on Wednesday, suggesting the economy’s recent loss of momentum is likely to persist absent any new action by policymakers.
The Thomson Reuters/PayNet Small Business Lending Index, which measures the overall volume of financing to small U.S. companies, sagged to 98.5 from 103.8 in May, PayNet said. The index, which points to changes in overall economic growth several months in the future, has fallen in five of the past six months.
“Small businesses really took a dive,” said PayNet founder Bill Phelan. “What this means is, the slowdown is going to continue.”
Borrowing rose 2 percent in June from a year earlier, the slowest year over year pace since July 2010.
The weak borrowing by small businesses comes as Federal Reserve officials weigh their next move on interest rates, sifting through mixed economic data to determine if they need to unleash still more monetary stimulus to bring down unemployment and kick-start growth.
The Fed says it is still considering just such a move, and some analysts expect
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