The latest CNBC CFO Council survey reveals growing concerns among chief financial officers about the economy and consumer demand. Walmart's CFO highlighted the retailer's challenging second quarter, reflecting a broader cautious sentiment among CFOs. The survey, conducted from June 3 to June 20 with 24 respondents, found that over half of CFOs now cite consumer demand as the biggest external risk, up significantly from 18% a year ago. This concern is echoed across various sectors, with CFOs noting challenges in moving inventory and a shift towards value-oriented offerings. While consumers continue to spend on travel and dining, transaction values are decreasing, indicating a trend towards more cost-effective spending.
CFOs' views on the Federal Reserve and interest rates remain relatively stable, with 70% rating the Fed's performance as "good." However, inflation concerns persist, with 42% of CFOs believing inflation will not reach the Fed's 2% target until 2026. Despite a decline in overall economic optimism, a third of CFOs still anticipate a soft landing, although this is down from 48% last quarter. As the economy faces potential recession and stock market volatility, CFOs also highlighted interest rates and inflation as critical issues leading up to the election, with a notable 58% predicting Donald Trump's victory in 2024.
