What Global Leaders Think of the US Economy

By: Anneken Tappe · January 17, 2024 · Reading Time: 2 minutes

The Davos Outlook

CEOs at the World Economic Forum in Davos, Switzerland, are feeling relatively good about the U.S. economy, even in the face of geopolitical tensions, trade concerns, and an upcoming presidential election.

The reason for the cautious optimism? Sustained consumer demand.

Economic Optimism

The sentiment at Davos has been echoed by business leaders at home. Honeywell (HON) CEO Vimal Kapur identified persistent demand in the travel sector as a positive sign, while PepsiCo (PEP) chief Ramon Laguarta pointed to a stabilizing job markets and falling commodity prices as grounds for optimism.

The positive sentiment, along with supportive economic data showing cooling inflation and a continued strength in the labor market, are adding to the hopes that the Federal Reserve may be able to achieve a soft landing for the U.S. economy. Market expectations for interest rate cuts are also rampant, with the first rate cut expected in March, according to the CME FedWatch Tool, which could be a catalyst for spending and dealmaking.

The Global Impact

While the overall sentiment among CEOs remains positive, leaders in Davos weren’t blind to risk factors that could affect businesses and trade.

Ongoing geopolitical conflicts pose a risk for shipping and the supply chains. Meanwhile, major elections are scheduled in more than 60 countries this year, including the U.S.

With a lot of unknowns having the potential to derail things and change sentiment, business leaders are cautious when it comes to 2024.

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