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U.S. CEO Optimism Hits Record as Tax Cuts Boost Spending Plans

Bloomberg 2018-03-13 20:00:00

Optimism among chief executive officers of large U.S. companies has reached a record high, a Business Roundtable survey showed Tuesday.

Highlights of CEO Economic Outlook (1Q)

  • Index advanced to 118.6, highest since the survey began in 2002, from 96.8 in the fourth quarter; readings above 50 indicate expansion
  • Gauge of capital spending plans in the next six months rose to 115.4 from 92.7; sales outlook jumped to 141.9 from 122
  • Measure of hiring expectations increased to 98.5 from 75.7

Key Takeaways

The latest quarterly report on the Washington-based group’s index is the first reading since President Donald Trump and Republican lawmakers enacted tax cuts for corporations and individuals.

The results underscore widespread optimism in the U.S. economy as the fiscal stimulus, tight labor market and solid global growth provide tailwinds to the American recovery. The survey came hours after a National Federation of Independent Business poll showed small businesses were the most optimistic in more than three decades.

The Business Roundtable, or BRT, conducted the poll before Trump announced plans for tariffs on steel and aluminum imports. Business groups that are longtime GOP allies, including the Business Roundtable and the U.S. Chamber of Commerce, opposed the president’s move.

Official’s Views

“These results validate BRT’s advocacy of smart and inclusive economic policies,” JPMorgan Chase & Co. CEO Jamie Dimon -- who serves as chairman of the Business Roundtable -- said in a statement. “Put into action, the survey results translate into more jobs and opportunity for all Americans.”

Other Details

  • CEOs expected economy to grow 2.8 percent in 2018, up from 2.5 percent projected last quarter
  • The survey, with responses from 137 member CEOs, was conducted between Feb. 7 and Feb. 26