U.S. business leaders were quite cheerful in the first quarter of 2014.
In fact this optimism is moving the needle of investment forward with 43% of those surveyed for Grant Thornton’s International Business report saying they will invest in plant and machinery.
“Following our nation’s political leaders reaching a short-term budget agreement late last year and as economic indicators continue to show improvement, the large increase in optimism among business executives could be indicative that we have moved into the first prolonged period of economic stability since the financial crisis,” said Stephen Chipman, chief executive officer of Grant Thornton LLP.”
The stronger business climate has caused only 29% of the business leaders to economic uncertainty as a constraint on their ability to grow their operations in the next 12 months, down from 37% in the previous quarter.
U.S. profitability expectations improved eight percentage points to 60% with business leaders expecting to see profits climb in the next year, following a two percentage-point decrease in the previous quarter.
Hiring expectations in the United States increased to 45%, up seven percentage points from last quarter.
However, revenue expectations decreased to 64%, just a slight decline from 65% the previous quarter.
“Our country’s business leaders will continue to require consistent signs of stability in fiscal, public and tax policies to feel confident about their decisions, including investing in their businesses, creating jobs and growing their operations,” Chipman warns.
Global optimism is high as well, according to the report which surveyed 3,300 business leaders in 45 countries. China’s positive outlook increased to 38%, up from 22% in fourth quarter 2013.
Japanese business optimism increased 11 percentage points to 17%
BRIC business optimism rose from a net balance of 22% to 40%, driven by a dramatic 26 percentage-point increase in Brazil. Optimism in Brazil rose to a net balance of 36%, up from 10% in fourth quarter 2013.
Business sentiment in India improved to net 89%, up 20 percentage points from last quarter.