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Economic Confidence Improves Globally but Continues to Drop in US

The latest Global Economic Conditions Survey (GECS) from IMA® (Institute of Management Accountants) and ACCA (the Association of Chartered Certified Accountants) released in late-October found economic confidence has improved globally while continuing to fall in the United States in the third quarter of 2017. You can read the full report here.

The survey noted that global economic confidence—at its second highest level in over two years—was bolstered by high performance across Asia and Africa, benefitting from a sustained period of economic expansion since the global financial crisis and offsetting depressed confidence in the Middle East and the Americas.

“This quarter’s GECS suggests that the global economy is enjoying a strong recovery. While the global picture is optimistic, however, it does hide variations, with some regions doing much better than others,” said Narayanan Vaidyanathan, senior business analyst at ACCA.

South Asia was the most confident region in this quarter’s GECS, with the region’s two biggest economies, India and Pakistan, set to grow strongly over the next year. Said Vaidyanathan, “Economic confidence across Asia-Pacific is also strong, reaching a record high after three consecutive quarterly increases. The recovery in global demand, and subsequent improvement in export prospects, has created the fastest local levels of growth in several years.”

The survey paints a different picture in the United States, where business confidence fell for the second consecutive quarter. “This quarter, the number of people feeling less confident about the future exceeded those feeling more confident. This is the first time we’ve seen this since Q3 of 2016. The drop comes as the U.S. administration continues to deal with challenges in pushing through healthcare reform, tax cuts, and increases in infrastructure spending,” said Raef Lawson, Ph.D., CMA, CPA, IMA vice president of research and policy.

Overall, economic confidence in North America fell slightly in the third quarter of the year, with 28% of respondents saying they were feeling more confident about the future, compared with 30% who were feeling less confident. Canada has been the most optimistic part of the North America and Caribbean region over this last quarter.

Fieldwork for the Q3 2017 GECS took place between September 1 and 18, 2017 and attracted 1,277 responses from IMA and ACCA members around the world, including more than 114 CFOs.

For more information on the global economic conditions throughout 2017, see the Q1 and Q2 GECS reports.
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