Chief executives of major U.S. companies have a brightening view of business and economic conditions and look for the Federal Reserve to raise interest rates modestly this year, a survey by the Business Council found.
A strong majority — 70.4 percent — of CEOs expect business conditions in their industry to improve over the next six months, the group said in a study conducted with The Conference Board and released on Thursday.
That represents a marked change from the last edition of the survey, in October, when just 34.2 percent expected business conditions to improve.
The improvement reflected a surge in confidence about the U.S. economy, and a brightening of CEOs’ views of Europe, while their confidence in China deteriorated. Just under 46 percent expected Chinese business conditions to pick up over the next six months, compared with 49.3 percent who expected that in October.
CEOs expect the Federal Reserve to leave its target funds rate steady at 0 to 0.25 percent through June and then raise it by 0.25 percentage points to 0.5 percentage points by December.
The group’s 124 members include the heads of some of the largest U.S. companies including Exxon Mobil Corp, General Electric Co and Bank of America Corp.
The group did not say how many of its members responded to the survey.
Their confidence did not extend to hiring, though. Fifty-one percent said they expected to add workers in select areas, but respondents expected unemployment to remain elevated at 9.1 percent to 9.5 percent.
They did expect to pay their workers more, with 40 percent expecting wage growth this year, up from 25 percent who expected that in October. Thirty-five percent look for prices to rise, up from the 26 percent who did so in October.