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Chief Executives' Confidence Declines -- Again
NEW YORK -- Chief executives' confidence in the nation's economy, which had retreated to 70 in the second quarter, sagged again in the third quarter of 2004, finishing at 63, according to The Conference Board. A reading of more than 50 points reflects more positive than negative responses."CEO confidence has slipped considerably over the past two quarters, as both current conditions and expectations have softened," said Lynn Franco, director of The Conference Board's Consumer Research Center. "However, nearly a third of CEOs have increased capital spending plans this year, with an increase in sales volume the most cited reason."While CEOs' overall assessment of current conditions remains positive, the level of confidence has weakened. Now, approximately two-thirds of CEOs say current economic conditions have improved, down from 90% last quarter. In assessing their own industries, only 57% say conditions are better, down from 71% last quarter.CEOs' short-term outlook is also more tempered as 55% of business leaders now expect economic conditions to improve in the next six months, down from 64% last quarter. Their expectations for their own industries were more subdued as well, with 52% anticipating an improvement, down from nearly 60% last quarter.Approximately 33% of CEOs report an increase in their companies' capital spending plans since January of this year, while only 6% have scaled plans back. This is an improvement from last year, when only 12% of business leaders had increased their capital spending plans, while 31% had made cuts.Visit The Conference Board: www.conference-board.org"