Despite high levels of economic confidence expressed by business owners and consumers, one key indicator shows that it has not translated into much action yet.
Loan issuance declined in the first quarter from the previous three-month period, the first time that has happened in four years, according to an SNL Financial analysis of bank earnings reports filed for the period. The total of recorded loans and leases fell to $9.297 trillion from $9.305 trillion in the fourth quarter of 2016.
The decline was slight — just 0.1 percent — but significant both in the larger picture and because of the main reason for the drop.
Commercial and industrial lending, considered an economic bellwether, usually pops this time of year as companies prepare for the construction season again. Instead, 2017 began with just a 0.9 percent rise in C&I transactions, a gain that couldn't offset the normal seasonal drop in credit card loans.
In addition, the lending picture was hampered by an unusual decline in auto loans, which fell for the first time since banks started reporting on them in 2011.
Overall, the business climate, at least measured by the willingness to take on debt, remains cautious.
"It's unclear what's going on right now. There may be caution because of political uncertainty both on the monetary policy side and the fiscal policy side," said Ernie Tedeschi, economist at Evercore ISI. "It's one of those things that we're going to have to see how it evolves over the next couple of quarters."