New loans rose 10% PHOTO: SHUTTERSTOCK

Borrowing by US companies to spend on capital investment rose last month, according to the Equipment Leasing and Finance Association (ELFA).

Reuters reports that companies signed up for USD8.9 billion in new loans, leases and lines of credit in March, up 10% from a year earlier. Their borrowing rose 51% 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 says in a statement.

ELFA, a trade association that reports economic activity for the USD1 trillion equipment finance sector, says credit approvals totalled 74.5% in March, down slightly from 74.8% 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.

The Equipment Leasing & Finance Foundation, ELFA's non-profit affiliate, reports that its confidence index fell to 65.8 in April from 71.1 in March. A reading of above 50 indicates a positive outlook.