CFOs Embrace Optimism in Spite of Uncertainty

Deloitte survey highlights positive business outlook for the near-term.
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As the broad global economy seems to be strengthening, respondents to the 2Q Deloitte Global CFO Signals survey are optimistic and "seem to be enjoying the ride," the report's authors note.

In North America, more than half (55 percent) of CFOs report positive outlooks, despite the uncertain and unstable political and policy climate. Most of Europe is likewise optimistic, with four of the five participating countries (Belgium, Netherlands, Russia and Switzerland) solidly optimistic. The UK, however, retracted on "fallout from the general election" in June, as well as continued concerns about the long-term of Brexit.

The three countries in Asia-Pacific – Australia, India and Japan – reported stabilizing conditions and optimism for the future, despite increased risk scenarios in that region.

"CFOs have been citing rising volatility in the business environment as a top challenge for several years," said Greg Dickinson, managing director, Deloitte LLP, and lead for the North American CFO Signals survey. "Even so, our survey findings seem to indicate that they are not waiting for anything to get resolved – and that they continue to push forward on the investments they think make the most sense for the future."

At the same time, CFOs in North America report growing concern in many areas, including rising political turmoil around potential Russian interference/collusion and an uncertain path for tax and health care legislative reform.

The optimism and willingness to invest is a distinct change from a year ago, when respondents were much more hesitant – in large part because of the political uncertainty surrounding the U.S. election.

And those plans are primarily focused on growing business organically (61 percent) rather than through acquisitions or other inorganic methods (16 percent) – the highest level of bias for organic growth in more than four years.

Perception of the North American economy remains near its two-year high. Nearly two-thirds of CFOs said current conditions are good, while 58 percent expect even better conditions in a year.

Get more detail about the Deloitte 2Q CFO Signals Report.

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