As the global economic recovery gathers momentum, there is growing confidence in the boardrooms of the world’s largest companies. Among the members of CNBC’s Global CFO Council, 63% say that the global economy is improving, while 29% say that it is stable and just 8% think it is declining.
Tom McGrath, EY Americas Senior Vice Chair – Accounts, says that this finding reflects a more stable environment for business, particularly in the US.
“A year ago, there was greater uncertainty over monetary policy and the US fiscal cliff, quantitative easing was coming to an end and growth was starting to weaken in emerging markets,” he says. “With the recovery under way, now is the time for companies to be bolder in their investments and to make a move, albeit on a selective basis.”
Currently, however, many CFOs remain cautious, despite the improving external conditions. This probably reflects a sense that the recovery is still fragile – which raises questions for companies about where to invest.
“Globally, there seems to be some wind in the sails for certain economies, but I do think it’s uneven,” says Jay Nibbe, EY Global Accounts Chair. “Certainly, clients are concerned about where they place their bets when you have that kind of inconsistent economic recovery.”