Business Roundtable: Expect Higher Sales, Cap-Ex, Hiring

WASHINGTON — Business leaders expect higher sales will lead to more business spending and hiring in the next six months, an industry survey of chief executives said Wednesday.

The Business Roundtable's fourth quarter 2013 CEO Economic Outlook Survey shows an uptick in expectations for the economy over the next six months, with the index increasing to 84.5 from 79.1 in the third quarter. It was the highest reading in five quarters.

"CEO expectations for economic expansion in the next six months increased slightly from last quarter, with expectations for sales, capital investment and hiring all tracking somewhat higher," Chairman of Business Roundtable Jim McNerney, said in a statement.

The 120 CEOs responding to the survey expect 2014 GDP growth to be about 2.2%, which is in line with the previous two quarterly surveys' expectations.

"In aggregate, our expectations are consistent with an economy that will continue along the path of steady, modest recovery into the first half of 2014," said McNerney, who is Boeing's CEO. "These soundings are also consistent with an overall economy that, despite progress, is not yet performing at its full potential."

In the most recent survey, 39% of the CEOs expect to increase capital expenditures over the next six months, compared to 27% in the third quarter. Both hiring and sales expectations were up two percentage points from the previous reading.

The survey also asked CEOs an annual question about the top cost pressure facing their business over the next six months. Regulatory costs topped the list with 39% ranking it number one, followed by labor and health care costs. Regulations were the top concern in fourth quarter 2012 too.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

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