In the words of Roger W. Ferguson, Jr., The Conference Board’s Trustee, “CEOs are now preparing for near-inevitable recessions in both the US and Europe. While the vast majority still expect the US recession to be short and shallow, nearly 7 in 10 believe the EU will enter a deep recession with serious global spillovers.”
A survey conducted by The Conference Board, a non-profit research firm, revealed that the confidence of CEOs in the UK and US economies has hit an all-time low since the Great Recession.
The Conference Board conducted its quarterly "Measure of CEO Confidence" survey between September 19 and October 3. Over 136 CEOs participated in the survey and voiced their opinions on how they believe the financial markets will behave in the next 12-18 months.
The survey revealed that 99% of the CEOs predicted that the UK will enter a recession in the coming months. A majority of them are expecting a long recession with a serious impact on the global markets.
Similarly, 98% of the CEOs have begun preparing for a US recession, with just 5% of the executives believing that the economic conditions will improve over the next six months. Unlike their predictions for the UK, the CEOs speculate a short recession in the US will have a negligible fallout in the financial market.
The findings of The Conference Board’s survey were backed up by a similar report from Goldman Sachs. The banking giant revised its economic outlook following Liz Truss reversing the corporate tax proposal.
Earlier, it predicted that Britain's economy will shrink by 0.4% by the end of 2022. Goldman Sachs now warned the annual growth projection may instead contract by 1%.
The recent developments have also led to many analysts speculating the Bank of England may hike the interest rates by 75 points. The BoE's next policy announcement is scheduled for November 3.
