On July 2, 2020, The Conference Board released the 2nd Quarter Measure Of CEO Confidence. The overall measure of CEO Confidence was at 44, up from 34 in the first quarter. [note: a reading of more than 50 points reflects more positive than negative responses]
Notable excerpts from this July 2, 2020 Press Release include:
CEOs remain very pessimistic about current economic conditions. All respondents said conditions are worse compared to six months ago, about the same percentage as in the second Q1 survey (“Q1a”). CEOs also continue to feel grim about current conditions in their own industries. Currently, only 10 percent say conditions are better compared to six months ago, up from 5 percent last quarter. Additionally, about 82 percent of CEOs say conditions are worse in their own industries, down from about 92 percent last quarter.
Despite feeling bleak about the present, CEOs are generally optimistic about the economic outlook in the next six months. Now, 71 percent expect economic conditions will improve over the next six months, compared with 50 percent last quarter. Moreover, only about 16 percent expect economic conditions will worsen, down from 44 percent during Q1. CEOs’ expectations regarding short-term prospects in their own industries over the next six months mirrored their expectations for the overall economy. Now, about 70 percent of surveyed CEOs anticipate an improvement in conditions, up from about 49 percent last quarter. Those expecting conditions will worsen in the short term decreased to 22 percent from 46 percent in Q1 2020.
Last month, the Business Roundtable also released its CEO Economic Outlook Survey for the 2nd Quarter of 2020. Notable excerpts from the June release, titled “Business Roundtable CEO Economic Outlook…“:
Business Roundtable today released its Q2 2020 CEO Economic Outlook Survey, a composite index of CEO plans for capital spending and hiring and expectations for sales over the next six months. This quarter the overall Index was 34.3, a decrease of 38.4 points compared to Q1 2020. This is the lowest reading of the Index since Q2 2009, but it remains above the record low of -5.0 reached in Q1 2009.
In their second estimate of 2020 U.S. GDP growth, CEOs projected a 3.8 percent contraction for the year, which dropped 5.8 percentage points from last quarter’s estimate of 2.0 percent growth.
Additional details can be seen in the sources mentioned above.
I post various economic forecasts because I believe they should be carefully monitored. However, as those familiar with this site are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 3152.05 as this post is written