Inflation, High Interest Rates Weigh on Small, Midsize Company CEO Confidence [Video]

CEOs of small and midsize companies are feeling less confident about the economy than they were earlier this year.

The Vistage CEO Confidence Index stood at 83.3 for the second quarter, falling from 85.9 in the first quarter. The decline in confidence is partly a consequence of inflation and elevated interest rates, Vistage said. To tamp down record inflation, the Federal Reserve has hiked rates from near-zero to more than 5% in the past two years. 

The majority of CEOs (64%) surveyed said that elevated interest rates were hitting their businesses. Despite this, 60% still expect increased revenue in the next 12 months. 

While inflation has cooled, from more than 9% in the summer of 2022 to 3% now, businesses are still feeling the effects of higher prices, whether it’s from costlier labor or raw materials expenses. Fifty-nine percent of respondents said the biggest source of inflation affecting their business was labor, 12% believed it was raw materials, 9% thought it was …