More economists reported rising sales and profit margins at their companies over the past three months, according to the April Business Conditions Survey compiled by the National Association for Business Economics.
The professional organization polled 49 of its members earlier this month and found the Net Rising Index for sales–that is, the difference between the share of respondents reporting rising sales and those reporting falling sales–hit its highest level in two years. The Net Rising Index for profit margins was even more upbeat, notching its best reading since October 2021.
Their outlook for the next three months was not as rosy. Plus, fewer economists said their companies are passing some or all of their cost increases onto their customers, suggesting businesses may not have much more room to raise prices to account for inflation without triggering a consumer backlash.
“Results suggest a still-strong business environment,” said NABE president and Morgan Stanley chief U.S. economist Ellen Zentner in a statement with the survey release. “However, fewer panelists than in January expect their firms’ sales or profit margins to increase in the next three months.”
The group of economists surveyed was also pretty evenly divided about the likelihood of the U.S. economy entering a downturn. Nearly six in 10 respondents cited a recession as one of the top downside risks to their companies’ outlooks. But when asked about the biggest upsides for their companies’ outlook, two-thirds of economists expect the country to avoid a recession, the most popular choice.
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