Chief Executives’ Confidence in U.S. Declines to One-Year LowBen Schenkel
Confidence among U.S. chief executives dropped in the third quarter to the lowest level in a year on concerns political infighting in Washington will hurt the economy, according to a private survey.
The Young Presidents’ Organization index of sentiment fell to 60.5, the weakest since the same three months last year, from 62 in the previous three months. Readings greater than 50 indicate that respondents were more optimistic than pessimistic.
“Many economists continue to anticipate somewhat more rapid expansion in the U.S. economy for 2014,” Stephen Slifer, chief economist at NumberNomics LLC, said in a statement. “That seems to be at odds with the YPO leaders in this latest survey, who may see unresolved political issues and continued economic uncertainty offsetting the positive factors.”
Some 38 percent of chief executives surveyed said the economy had improved from six months earlier, down from 49 percent in the previous three months.
Respondents in the construction industry were the most upbeat, with 52 percent saying economic conditions were better than in the previous six months. Still, the share is down from 65 percent in the second quarter, which may reflect an increase in mortgage rates.
The share of U.S. respondents anticipating better business conditions in the next six months declined by almost 10 percentage points to 42 percent.
While sentiment fell in the U.S., the group’s global measure improved. The index for the European Union climbed to the highest since the first quarter of 2011.
The nonprofit service organization’s findings were based on responses from 2,113 chief executives worldwide, including 745 in the U.S., to an electronic survey conducted during the first two weeks of October.