Report
Published August 13, 2024
Commercial Commercial Insights Credit & Economic Trends Economic & Market Insights
The excitement of a U.S. Election cycle in the fall, a cooling economy, rising unemployment, and a turbulent international landscape all play into a fall filled with anxious sentiment but stable cash flows. The economy has been humming at a stable pace over the last two quarters. Consumers have been spending their wage gains while not overleveraging their cards. This stability in the market has led small businesses to operate in the U.S. at pace with expectations. Growth has been slow as credit markets, although open, have tightened underwriting policies that limit both the consumer and small business from gaining access to low-cost funding to enter a season of true growth in the U.S. The economy is cooling, and the market expectations for a Federal Funds Rate cut are rising.
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Video
A Growing Small Business Financial Fraud Problem
This week’s Commercial Pulse Report from Experian reveals critical shifts in the economy for small businesses. Inflation eased slightly to 2.8%, and the Small Business Index ticked up to 41.5—signs of stabilization. But rising financial fraud remains a major concern. Also:
🔒 70% increase in fraud since the pandemic
🧠 $40B in projected losses from AI-driven scams by 2027
📊 46% of SMB loan applications showed signs of first-party fraud
Lenders are responding with AI-powered analytics and cross-industry collaboration to stay ahead of these threats.
Check out the full report to see how these trends could impact your strategy!
Report
Trade War Blues
The escalating trade war and rising economic uncertainty are causing businesses and lenders to adopt a cautious approach, potentially slowing investment and hiring. If this trend continues, the economy could face long-term risks, including reduced lending, weaker job growth, and increased vulnerability to unemployment spikes. Insights include:
- Business investment was already slowing before the trade war, and uncertainty is now at an all-time high.
- Banks may tighten lending further due to rising business delinquency and unrealized losses in securities portfolios.
- The labor market, while stable, is struggling with low hiring rates, making it harder to absorb job seekers.
- A prolonged decline in business investment could trigger higher unemployment if layoffs accelerate.
Video
Small Businesses Driving a Manufacturing Comeback
In this week's video we touch on current small business macroeconomic conditions as well as share insights on the manufacturing
The U.S. manufacturing sector has been in a period of contraction for more than two years, but recent data suggests that a turning point may be on the horizon. The Purchasing Managers’ Index (PMI) reached 50.9 in January, breaking past the critical 50-point threshold for the first time in 26 months. This indicates that manufacturing activity is shifting from contraction to expansion, a positive sign for small businesses that have been a major driver of growth in the sector.
Check out the full report to see how these trends could impact your strategy!
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