July 1 – A joint quarterly survey released by Duke University’s Fuca School of Business, Richmond and Atlanta on June 29, showing that senior managers in the U.S. financial industry are more pessimistic about the performance of the U.S. economy, and a confidence index fell to a 12-year low.
The survey was conducted from May 25 to June 10 and asked 320 chief financial officers of U.S. companies about the expectations of U.S. economic performance.
These chief financial officers generally expect their companies to face higher price and cost pressures, and the real GDP of the United States is expected to grow by 1.5% in the next 12 months, down from the expected growth rate of 2.5% in the first quarter of this year.
The survey results show that the average probability of negative economic growth in the United States in the following year is 21%, compared with 12% in the survey last quarter.
The “CFO Optimistic Index” was 50.7 this quarter, the lowest level since the end of 2012. The index was 60.3 in the fourth quarter of last year and 54.8 in the first quarter of this year, showing a continuous sharp downward trend.
“Price pressures have increased, real income growth has stagnated, and optimism about the overall economy has been greatly reduced,” said John Graham, a finance professor at Fuca Business School and academic director of the survey. “Monet tightening is one of the main factors leading to the deterioration of the economic outlook.”
The U.S. Federal Reserve announced an interest rate increase of 75 basis points on June 15, the single largest interest rate increase since 1994, and may raise interest rates by another 50 or 75 basis points in the future. Loretta Mester, president of the Federal Reserve Bank of Cleveland, admitted at a forum on the 28th that the U.S. economy was at risk of recession, and the Federal Reserve’s interest rate hike “just began”.
JPMorgan Chase Bank released a survey conducted from May 25 to June 10 on the 28th, showing similar low confidence results. According to the survey, the proportion of CEOs, chief financial officers and other senior managers of 1,500 medium-sized companies in the United States who are optimistic about the future year of the U.S. economy has plummeted from 75% in the same period last year to 19% now, the lowest level since 2010.
In the JPMorgan Chase survey, 71% of executives said that rising costs and high inflation are the biggest challenges facing companies. 80% of executives said they would continue to raise prices to ease cost pressure.
In addition, the final revised data released by the U.S. Department of Commerce on the 29th showed that the real GDP of the United States fell by 1.6% annually in the first quarter of this year, down 0.1 percentage point from the previously released revised data. U.S. personal consumption expenditure increased by 1.8% annually in the first quarter, down 1.3 percentage points from the previously revised data. Bloomberg interpreted that the sharp slowdown in consumer spending growth shows that the foundation of the U.S. economy is weaker than expected.
