Optimism about the economy spiked among US CEOs to start the year
Business Roundtable’s quarterly CEO sentiment report jumped by 11 points in the first quarter.
It climbed above its long-run average for the first time in two years.
America’s top brass is suddenly feeling more upbeat about the economy.
A new report from Business Roundtable that measures CEO sentiment showed that the gauge moved above its historical average for the first time in two years, spiking 11 points quarter-over-quarter to 85. The report also showed CEOs expect hiring, capital investment, and sales to all increase in the coming six months.
“This quarter’s survey results underscore the resiliency of the U.S. economy and suggest accelerating economic activity over the next six months,” Business Roundtable Chair Chuck Robbins, who is also the CEO of Cisco, said in a statement.
In their outlook for US GDP, respondents forecast 2.1% growth for the year, up from the 1.9% estimate from the prior quarter.
Official data shows that the US grew at an annualized rate of 3.3% in the fourth quarter of 2023, above the consensus estimate for 2.0% growth. The report suggests top executives are getting on board with growing calls for a soft landing of the US economy, and that the odds of a recession are decreasing.
To that point, the IMF published a report in January stating that global growth will be higher than expected at 3.1% for 2024, largely on account of the strength of the US economy.
The gauge of CEOs is in line with improving sentiment among Americans broadly. The University of Michigan consumer sentiment report showed Americans’ mood improving to start the year, climbing to its highest mark since July 2021. The reading dipped slightly in February’s reading, though it remains higher than a year ago.
A special question in the latest survey from the business group in this quarter’s survey showed that CEOs are feeling downbeat about government policy and regulation.
“A large majority of our CEOs are worried that excessive regulation and overreaching antitrust actions are eroding the foundation of free enterprise and the benefits it provides. We urge policymakers to recommit themselves to promoting economic growth, creating more American jobs and increasing economic mobility,” Business Roundtable CEO Joshua Bolten said.
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