First drop in 3Q
A survey of CEOs in the US shows that the economic outlook is less optimistic about their business prospects.
The index - a measure of expectations for revenue, capital spending and employment - fell to 69.6 in the 3Q from 73.5 in the 2Q.
- Economy to expand by 2.2% in 2016 (vs 2.1 previously).
- Sales outlook dropped to 98.3 from 108.6 last quarter. This is the largest decline in a year.
- Hiring fell by 3.4 points
- Capital spending was little changed.
Doug Oberhelman, CEO of Caterpillar commented that the report "reflects the unfortunate new normal - where the US economy is pretty much stuck in neutral rather than moving forward". He adds that "Washington can better support our economy through measures that create growth"
The FOMC meets next week with the market debating a hike or not (and the Fed too). The chatter is more and more turning to the idea that Washington has to do more while the Fed has done enough. The problem: Election and dysfunctional Washington which is not likely to get much better after the election.