Finance Executives Regained Confidence In The U.S. Economy For 2020

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A report released Thursday found that half of the finance experts surveyed are optimistic about the outlook, up from 42% last quarter, but a notable decrease from 79% early last year.

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The drop in confidence in the domestic economy last quarter was due to uncertainty about the U.S. and China trade war, says Ash Noah, a vice president and managing director at the Association of International Certified Professional Accountants. “As things have unfolded, there are signs that it is going to be resolved and we are not going to have as big a spat as we thought,” Noah says.

Inflation concerns eased in the fourth quarter, with 19% of respondents saying they feared rising costs, down from 23% in the previous quarter. Among individual factors, 47% of survey takers ranked labor costs as the most significant risk to their business, followed by raw material costs at 26% and interest rates at 13%. Noah thinks that the concern will continue to decrease.

The association puts together a CPA Index that measures the comprehensive view of all the executives surveyed based on their outlook on nine equally weighted factors — U.S. economic optimism, organization optimism, expansion plans, revenue, profits, employment, IT spending, other capital spending and training and development. The outlook for each individual factor is down year-over-year, with the largest decrease in U.S. economic optimism and revenue.

 

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