According to a recent survey, American CEOs are expressing a more positive outlook on the US economy than they have in the past two years.
The CEO confidence index has risen to 53, surpassing the 50 mark that signifies optimism about the economy, as indicated by the latest Conference Board report. This marks the first time since the first quarter of 2022 that the index has crossed the 50 threshold, having been at 46 in the final quarter of 2023.
“CEOs are feeling more optimistic about the economy, although they remain cautious about potential risks,” noted Conference Board Trustee Roger W. Ferguson, Jr.
According to Ferguson, the primary domestic challenge facing businesses this year is political uncertainty leading up to the US elections, with 51% citing global concerns. The ongoing spread of conflicts was identified by 46% of respondents as the most significant risk.
Among the key factors contributing to business optimism, CEOs highlighted reduced inflation, with 34% emphasizing this aspect, and Federal Reserve interest rate cuts, which were selected by 28% of respondents as beneficial factors.
The survey also revealed a notable increase in optimism regarding future economic conditions, with 36% of respondents anticipating improvement over the next six months, compared to 19% in the previous quarter. Conversely, 27% expect conditions to deteriorate, down from 47% in the previous survey.
However, there is a notable increase in the number of CEOs expecting to implement staff layoffs compared to the fourth quarter of last year. According to the Conference Board survey, 23% of respondents anticipate laying off workers, a significant rise from the 13% reported in the last quarter.