Several leading economists have trimmed their US growth projections for 2019 and 2020
New York (AFP) - Sentiment among US corporate leaders declined for the third straight quarter, according to a survey released Friday, the latest sign of mounting belief that US economic growth may have peaked.
The economic outlook rating among US chief executives declined to 104.4 in the fourth quarter from 109.3 in the third quarter, according to the Business Roundtable.
Plans for capital investment and hiring and sales expectations all declined compared with the prior quarter. However, all three categories remain high by historical standards, said the lobbying group, which is composed of the leaders of Apple, General Motors, IBM and other US giants.
Several leading economists have trimmed their US growth projections for 2019 and 2020, a recognition of an ebbing in the economic bump from a giant US tax cut signed into law by President Donald Trump in December 2017. Most economists still do not believe a US recession is likely in the near-term.
“What the survey says is the forward expectations are strong, they’re not as strong as they were four months ago,” said JPMorgan Chase CEO Jamie Dimon, who serves as chairman of the roundtable.
Dimon also said the US employment picture remained robust, despite US jobs data on Friday that showed disappointing growth in November.
“We’ve had some slightly weaker numbers this quarter but that may just be like a bump in the road,” Dimon said on a telephone briefing with reporters. “I think people are extrapolating too much from that.”
The roundtable has applauded Trump for enacting tax cuts and streamlining regulation but sharply criticized the US president for his aggressive approach on trade that has resulted in higher costs from tariffs that the group says has dented sentiment.
Business Roundtable President Joshua Bolten praised Trump for the trade tariff ceasefire with Chinese leader Xi Jinping. Bolten said he did not expect the 90-day timeframe for the China talks to be sufficient to address all the problems, but that it was a “good start.”
But Bolten criticized Trump’s plan to formally withdraw from the NAFTA agreement with Mexico and Canada in favor of a new regional trade deal that has been signed by not yet ratified by lawmakers.
The new pact is known as the US-Mexico-Canada Agreement.
“An actual withdrawal from NAFTA would be a disaster for the entire North American economy, including the United States,” Bolten said.
“We think if the administration is to get the new USMCA approved in Congress, it ought to be on its own merits, not with fear of something worse.”