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Economic Growth Will Be Modest: CNBC Global CFO Council Survey

The U.S. economy will modestly improve over the next six months. But, don't expect a big dent in unemployment numbers. Modest economic improvement also means modest hiring plans in the United States.

That's the outlook from the first survey of the CNBC Global CFO Council, a group of top financial officers representing a broad swath of the economy and controlling roughly a trillion dollars in assets. Members of the council come from a wide range of business sectors including retail, banking, energy and healthcare, to name a few.

CNBC will survey this group of CFOs on a regular basis to gauge the economic view from the ranks of top money men in the boardrooms of Corporate America.

And what they are seeing now is pretty mixed.

About 60 percent of the council agrees with current Fed rate policy and believe that along with corporate earnings, it is a key driver in propelling the record highs seen in the market this month. Yet the Number One risk to business is policy uncertainty in Washington while the ongoing European crisis still leaves U.S. businesses cautious.

More insights from the survey:

  • Over thirty nine percent of the CFOs say earnings growth in Q2 will be slightly better than expected from U.S. corporations
  • CFOs believe the probability of recession over the next 12 months is 14 percent
  • M&A transactions may only increase slightly in 2013 over the prior year
  • Over 60 percent prefer returning cash to shareholders through an increased dividend
  • About half expect their effective tax rates to be lower, if Congress acts on corporate tax reform


The complete results of CNBC GLOBAL CFO COUNCIL Survey can be found below:

Question 1


Question 2


Question 3

What are your expectations - to the nearest tenth - for Real US GDP in the year, 2014?

CNBC CFO COUNCIL 2.40%



Question 4

In your view, please submit the probability of recession in the United States over the next 12 months?

CNBC CFO COUNCIL 14%

Question 5

Question 6



Question 7


Question 8


Question 9


Question 10


Question 11


Question 12

What best describes your overall view of US corporate earnings per share (EPS) growth in Q1 2013 compared to Q1 2012?

Stronger than expected 0.0%
Slightly stronger than expected 34.8%
As expected 56.5%
Slightly weaker than expected 8.7%
Weaker than expected 0.0%


Question 13

What best describes your overall view of U.S. corporate earnings per share (EPS) growth in Q2 2013 compared to Q2 2012?

Stronger than expected 8.7%
Slightly stronger than expected 39.1%
As expected 43.5%
Slightly weaker than expected 8.7%
Weaker than expected 0.0%


Question 14


Question 15

What best describes your plans for hiring in the United States in the next six months?

Significant head-count increase 8.7%
Slight head-count increase 52.2%
Maintain same level of head-count 26.1%
Slight head-count decrease 13.0%
Significant head-count decrease 0.0%


Question 16

How would you describe your planned level of activity for M&A transactions in 2013?

Significant increase 0.0%
Slight Increase 26.1%
Maintain the same level as last year 43.5%
Slight decrease 0.0%
Significant decrease 4.3%
Not applicable to our firm in 2013 26.1%


Question 17


Question 18


Question 19


Question 20


Question 21

Please select what best describes in the current quarter, the level of customer demand for your products and /or services relative to your firm's lowest point in the recession of 2007-2008:

Demand is lower 0.0%
Demand is slightly lower 4.3%
Demand remains flat 0.0%
Demand is slightly higher 34.8%
Demand is higher 60.9%


Question 22

Question 23

Question 24

Do you expect Congress to take action to modify the corporate tax rate in the next 12 months?

Yes 26.1%
No 73.9%


Question 25

If Congress were to act on Corporate Tax Reform, I expect my firm's effective tax rate would be:

Higher 13.0%
Lower 47.8%
Same 39.1%


CNBC Global CFO Council

Video

  • Jan Siegmund, ADP CFO, and Bill Gerber, TD Ameritrade CFO, discuss how America's corporate leaders are viewing today's employment data and the current state of the U.S. economy.

  • Jon Moeller, Procter & Gamble CFO, breaks down P&G's quarterly numbers and discusses the company's cost-cutting measures.

  • UPS CFO Kurt Kuehn on CNBC's Squawk on the Street on his company's decision to stop deliveries for illegal online pharmacies and pay $40 million to end a Federal criminal probe into its shipping practices. Rival FedEx was in court today fighting similar charges.