CFOs Now Cite Rising Rates as Top Concern: Fed Survey — SkimNews
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- The Richmond Fed's quarterly CFO survey of around 500 firms found "monetary policy" cited as the top concern by roughly 20% of finance chiefs, up from under 15% in the prior quarter, overtaking inflation on the worry list.
- CFOs now expect to raise prices 5.3% this year and 4.5% next year, up from 4.6% and 4.1% projected in the second-quarter survey and well above the 3.6% figures seen at the start of 2021.
- The poll was conducted Aug. 17 to Sept. 4 — before the Fed's latest quarter-point rate hike but as policy debate tilted toward tightening and investors braced for higher borrowing costs.
- Richmond Fed economist Sonya Waddell said financing constraints are "most pronounced for small and financially constrained firms," with about a fifth of small companies saying such constraints are blocking expansion or making it hard to cover costs.
- Among firms not planning to invest, 42% blamed unfavourable financing or a need to preserve cash, up from 32% six months earlier, even as overall CFO optimism about the economy remained strong.
- The pricing-expectation jump came despite CFOs citing inflation less frequently as a top concern — a shift the survey attributes to rate-driven cost pressures feeding into their own price plans.
Why it matters: Finance chiefs at roughly 500 U.S. firms have re-ordered their priorities from inflation to interest rates, with about 20% of small companies already saying financing constraints are blocking expansion — evidence that the Fed's pivot toward tightening is reshaping corporate behaviour even before the most recent quarter-point hike fully lands.
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