According to a new study, the outlook of American CEOs has dropped to its lowest level in two years. This is because the country is still facing various challenges that could lead to a recession.
The Business Roundtable, which released the CEO Economic Outlook Index, said that its index fell during the fourth quarter of 2022. It is a quarterly survey that measures the expectations of chief executives regarding their sales and investment plans. A year ago, the index was at 124.
The Business Roundtable noted that the results of the survey revealed that executives are still cautious about the global and domestic economic outlook. They also cited various factors such as high inflation and the need for the Federal Reserve to take additional steps to tame it.
According to the Business Roundtable survey, the executives expect the country's gross domestic product to grow at a rate of 1.2 percent next year, which is lower than the previous forecast of 6 percent. When asked about the factors that have caused their pessimism, 49 percent of the respondents cited labor costs, while 15 percent cited material costs and 14 percent cited supply chain disruptions.
Mary Berra, the CEO of General Motors, said that many executives are still reluctant about their domestic sales and investment plans for the next six months due to the uncertainty caused by the supply chain issues and rising prices.
The rising interest rates that the Federal Reserve has been raising since early 2022 have led to higher borrowing costs for individuals and businesses. It could also cause an economic collapse.
The preceding is a summary of an article that originally appeared on AM Greatness.