12 December 2006 18:08 [Source: ICIS news]
WASHINGTON (ICIS news)--The US economy will see slower growth but a steady if unspectacular performance in the first half next year that will improve on the second half performance of this year, top US executives said in a survey issued on Tuesday.
The Business Roundtable’s quarterly survey of its members - chief executives at leading US companies - shows that “CEOs [chief executive officers] are expecting a period of slower growth compared with the first half of 2006, with no major up or down movement in the economy during the first half of 2007.”
Although the outlook for the first half next year is less robust than the economic performance seen in the first half this year, the first six months of the new year are expected to be better than the last half of 2006.
“Our 2007 outlook assumes greater GDP [gross domestic product] growth than we saw in the second and third quarters of this year,” said Business Roundtable chairman Harold McGraw, “but we believe it is tempered by uncertainties in consumer spending, a slightly higher interest rate environment and the large ?xml:namespace>
McGraw said the survey of top executives for the fourth quarter produced an outlook index of 81.9, virtually unchanged from the 82.4 measure recorded in the third quarter survey.
A Business Roundtable economic outlook index reading above 50 indicates an expanding economy. The 81.9 index for the quarter just ending compares with the more sanguine executive outlook index of 101.4 in the fourth quarter of last year. However, the nearly 82 index looks far more promising than the 52.7 index recorded in the fourth quarter of 2002.
McGraw said surveyed executives expect gross domestic product growth of 2.8% in 2007, slightly below the historical average of 3.1% growth seen over the past 35 years.
For the fourth consecutive quarter, top executives responding to the survey cited health care as the greatest cost pressure facing their businesses. McGraw said 51% of responding executives cited health care costs as their greatest concern, compared with only 16% of respondents who thought energy pricing was a greater worry.
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