'CFOs optimistic about US economy'

NEW YORK: Chief financial officers are more optimistic about the direction of the U.S. economy, but remain concerned about consumer demand and weak credit markets, according to a quarterly survey. Compared with the previous quarter, 28.5 percent said they were more optimistic about the U.S. economy, up more than 7 percentage points from June, according to the Duke University/CFO Magazine survey of about 1,300 CFOs, including 524 from the United States.

Those saying they are less optimistic fell to 41.5 percent, from more than half in the previous survey and more than 72 percent in March. About half expect the U.S. economy to begin recovering by the middle of 2009. "There are signs that we are bottoming out," said the survey's director, John Graham, a professor at Duke's Fuqua School of Business.

Still, many finance chiefs say they are cutting plans for capital spending and employment and 43 percent say the credit crunch is directly hurting their company. Capital spending is expected to rise 0.6 percent over the next year, the survey found, down from 2.3 percent growth expected three months ago. Employment is seen declining 1.6 percent over the same period, a steeper decline than was previously expected.

CFOs named weak consumer demand as their most pressing concern, followed by credit markets and the cost of fuel, the survey found. CFOs of U.S.-based firms were, on average, more optimistic than their counterparts in Europe and Asia. The divergence could suggest weakness ahead for U.S. exports, Duke and CFO Magazine said.