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CFOs are just like your Thanksgiving dinner table: Everyone’s suddenly nervous when the conversation turns to politics.
Three in 10 CFOs said uncertainty about the 2024 election had caused their firms to postpone, dial back, or outright cancel some investment plans, according to a new quarterly survey from the Federal Reserve Banks of Richmond and Atlanta and Duke University.
With respect to the upcoming election, CFOs ranked regulatory, monetary, and US corporate tax policy as the most pressing issues for their firms. The survey, which closed on September 6, polled 450 financial executives.
The election isn’t the only headwind on CFOs’ minds, though. Around 25% of respondents reported “that access to or cost of financing would constrain their capital spending in the next 12 months.” Small firms were more likely than large ones to report those financial constraints.
Still, they’re still planning to invest. More than a third of firms said they’re planning on investing “in structures in the next six months and two-thirds intend to invest in equipment.”
And while a majority of firms said they were investing to “repair or replace existing infrastructure,” CFOs also cited “increasing capacity and offering new products or services” as two of the most common reasons for those investments.
In all, CFOs are actually feeling optimistic about their firms’ economic path, despite election stress.
“In spite of uncertainty in the economy, firms still expect a soft landing,” Sonya Ravindranath Waddell, VP and economist with the Federal Reserve Bank of Richmond, said in a statement. “Financial executives expect to see growth in their employment and revenues through the year as firms continue to invest in the infrastructure that they need not just to continue operations, but to increase capacity and offer new products.”