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CEO Confidence Increases
added: 2012-01-17

The Conference Board Measure of CEO Confidence™, which had declined in the third quarter, improved in the last quarter of 2011. The Measure now reads 49, up from 42 in the previous quarter (a reading of more than 50 points reflects more positive than negative responses).

Says Lynn Franco, Director of The Conference Board Consumer Research Center: “The bounce back in CEO Confidence in the final months of 2011 was due primarily to an improved short-term outlook. Overall, however, CEO confidence remains rather subdued. On the inflation front, CEOs anticipate price increases of about 1.8 percent for 2012, down from last year’s estimate of 3.3 percent.”

CEOs’ assessment of current economic conditions was less pessimistic, with 17 percent saying conditions have improved compared to six months ago, up from just 11 percent last quarter. In assessing their own industries, however, business leaders were more pessimistic. Now, about 16 percent claim conditions have improved, down from 19 percent in the third quarter of 2011.

CEOs’ optimism about the short-term outlook improved from last quarter. Currently, about 32 percent of business leaders anticipate an improvement in economic conditions over the next six months, up from 19 percent in the third quarter. Expectations for their own industries are also more upbeat, with approximately 25 percent expecting conditions to improve in the months ahead, up from 22 percent last quarter.

Inflation Outlook: Moderate Price Increases Anticipated in 2012

The majority of chief executives expect changes in their firms’ selling prices in 2012. On average, firms plan to increase prices by 1.8 percent, much less than last year’s expectation of 3.3 percent. Only 6 percent anticipate price increases in excess of 10 percent.

Source: The Conference Board

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