(Reuters) - U.S. companies increased borrowing to finance equipment investments by 13% in July compared with the previous year, the Equipment Leasing and Finance Association said on Thursday.

New loans, leases and lines of credit signed up by companies in July were up 11% from $10 billion a month earlier.

"Our latest report reflects optimism from industry leaders that equipment demand should remain healthy over the second half of the year as the Fed begins to ease monetary policy," ELFA President and CEO Leigh Lytle said.

The Washington-based company, which reports economic activity for the over $1-trillion equipment finance sector, also said that credit approvals for U.S. companies in July were 75.8%, up from 75% in June.

ELFA's non-profit affiliate, the Equipment Leasing & Finance Foundation, said its confidence index for August stood at 58.4, up from 50.7 for July, its highest level in more than two years. A reading above 50 indicates a positive business outlook.

The ELFA's leasing and finance index is based on a 25-member survey that includes Bank of America ( BAC ) and financing units of Caterpillar ( CAT ), Dell Technologies ( DELL ), Siemens AG, Canon Inc ( CAJFF ) and Volvo AB.