The latest Global Economic Conditions Survey (GECS) from IMA® (Institute of Management Accountants) and ACCA (the Association of Chartered Certified Accountants) found that global economic confidence is at its highest level in years, with strong growth since the start of 2017. Economic confidence is at its highest level since the first GECS survey was issued in the first quarter of 2009. You can read the full report here.

The new survey found that confidence in North America rebounded strongly in the first quarter of 2018, with 38% feeling more confident about the future, compared with just 26% who were less confident. Although confidence improved in both the U.S. and Canada, the recovery in Canada was especially marked and confidence there is now at a record level.

"The outlook for the global economy is as good as it has been for some time," said Warner Johnston, head of ACCA USA. "Recent tax cuts have provided a boost to confidence and will help to ensure that the economy grows by a decent 2.5-3% this year.”

The report notes that the increase in confidence in the United States—at its highest level since Q1 2017—comes on the heels of significant tax cuts which should help boost consumption, increase wage growth, and prompt lower unemployment rates. Confidence also is high by historical standards, with the proportion of respondents feeling more confident about the future being 10 percentage points more than those less confident.

This improvement is consistent with the actual Gross Domestic Project (GDP) data, which shows the U.S. economy continuing to perform strongly, with unemployment at multi-year lows and wages recovering nicely. Raef Lawson, Ph.D., CMA, CSCA, CPA, CFA, IMA vice president of research & policy and professor-in-residence, cautioned that the biggest risk to the overall outlook is the possibility of a trade war between the United States and China, given proposed measures including tariffs, which could escalate tension and impact other regions globally. If this does not occur, the global economy likely would see another year of strong growth.

"Since the start of the year, policymaking in the U.S. has taken a more protectionist turn, causing concern about a possible trade war with China," Lawson said, noting China's recent announcement of counter-tariffs. "It is possible that this response by China could escalate the crisis as the U.S. government is no longer willing to abide large imbalances in trade cause by unfair trade policies."

Fieldwork for the Q1 2018 GECS took place between February 27 and March 15, 2018, and attracted 1,418 responses from ACCA and IMA members around the world, including more than 100 CFOs.

For more information on the global economic conditions throughout 2017, visit IMA's website.