CFOs Report Increased Optimism as Uncertainty Fades

The outlook for the U.S. economy among financial decision-makers improved somewhat in the third quarter of 2025, as uncertainty declined. However, concerns about the impact of tariffs on prices and business performance continued to weigh on firms, according to the CFO Survey, a collaboration of Duke University's Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta.

Uncertainty remains a top concern of financial decision-makers, but it dropped in importance from second highest in the second quarter to seventh in the third quarter.

"Likely, it is the fall in uncertainty that helped boost optimism in the third quarter," said Sonya Ravindranath Waddell, vice president and economist with the Federal Reserve Bank of Richmond. "The return of optimism and GDP expectations to levels more in line with the beginning of 2024 is reassuring. But concern about tariffs is real and impactful for many CFOs in the survey."

For the third consecutive quarter, tariffs and trade policy were the top concern among survey respondents, followed by monetary policy and inflation. The firms that cited tariffs as a top concern were notably more downbeat about the economy and their own firm. Specifically, these firms:

• Were less optimistic about the U.S. economy (59.9 for the tariff-concerned group versus 64.3 for those unconcerned)
• Projected lower real GDP growth for the year ahead (1.6 percent versus 2.0 percent)
• Had lower revenue and employment growth expectations for 2025
• Forecasted notably higher input cost growth in 2025 and 2026
• Expected higher price growth in 2025 and 2026

Overall, CFOs projected that tariffs would have a big impact on price growth: On average, price growth would be about 30 percent lower in 2025 and roughly 25 percent lower in 2026 without the addition of tariffs, indicating that firms expect to grapple with tariff-related price increases into 2026. Meanwhile, almost a quarter of firms continued to report that they will decrease capital spending in 2025 due to tariffs.

The CFO Survey is issued by Duke University's Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta. The latest survey, as well as historical data and a detailed analysis of the impact of the election on the corporate outlook, can be found at https://www.cfosurvey.org. Sign up to receive email notifications when new results are posted.

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