US business has an underlying strength as revealed by PayNet Small Business Lending Index. The index shows that U.S small business borrowings hit its highest level in four years in November 2011. The index surged 10.2 points to 106.4 points, the highest level since Feb 2008.
The US is now entering a new phase of business cycle. Businesses are betting on future with increased investment spending. The survey further shows that the economy gained in momentum in final three months of 2011. Paynet tracks U.S small businesses and provides risk management tools to help commercial lending industry of US.
The survey collected data that suggests that the US economy’s momentum improved during the final three months of 2011. This is going to better help it handle debt crisis in Europe and fight back budget policy in Washington.
Economic growth has accelerated from 1.8 percent in third quarter to 3 percent annual pace in fourth quarter. The surge in borrowing is an indication that there will be growth in the next quarter. There is underlying strength in US economy as the PayNet lending index has some leading correlation with GDP and indicates preceding changes of economy in advance by two to five months. The survey also revealed that small businesses have started to manage their debts wisely as loan delinquencies continue to drop.
This article was submitted by Raj Tulshan, Director of Business Development of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to email@example.com