President Donald Trump’s approval ratings are declining as Americans become dissatisfied with his handling of the economy. With stock prices still near all-time highs and corporate earnings strong, will there be yet another divide between Wall Street and Main Street?
Not exactly, according to the results of the latest CNBC CFO Council survey.
CNBC’s CFO Council Q4 Survey shows that executives and the public are not that far apart in how President Trump has handled his work in the first year of his second term, but a majority of chief financial officers remain optimistic about the U.S. economy despite a weakening labor market and lower income levels for consumers. CFOs responding to the survey cited consumer demand as the biggest risk to their businesses, echoing widespread concerns about Americans maintaining spending levels, but they don’t see an economic cliff ahead.
More than half (59%) of CFOs say there will be no recession next year, and 73% of CFOs say they are optimistic about the economic outlook. Only two CFOs expect the stock market to correct by at least 10%, and none predict a bear market in the future. However, most CFOs believe the stock will remain within a trading range before hitting a new all-time high. Dow Jones Industrial Averageit’s impossible for the index to go above 50,000 in the foreseeable future, so we’re pretty cautious after the double-digit rise in stock prices year-to-date (16% for the stock index). S&P500).
Despite this positive stance on the economy and markets, and despite the extension of the tax cuts that American companies had hoped for, CFOs’ views on the first year of the president’s second term are lukewarm at best. Our quarterly survey explores opinions from a sample of CNBC CFO Council chief financial officers. The fourth quarter survey included 22 CFOs and was conducted from December 1st to December 1st. 8.
72% of chief financial officers (CFOs) who responded to the survey rated the president’s performance this year as fair (10) or poor (6). Only two CFOs rated Trump’s performance “excellent,” and another four rated Trump’s performance “good.”
Kevin Hassett, director of the National Economic Council, is the front-runner for President Trump and Federal Reserve Chairman. A new CNBC survey of chief financial officers does not expect a major change in Fed interest rate policy or a new Fed chair to be more effective than Jerome Powell.
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The issues that are expected to hamper the president are just that: 14 CFOs said Trump’s immigration policies are “insufficient,” especially as they relate to the conditions necessary for business success, and 20 CFOs described Trump’s trade policies in similar terms. Recent polling on President Trump’s immigration policies has been mixed, with New York Times polling data showing the president remains above overall approval levels, but recent Gallup data showing a decline. Seven chief financial officers (CFOs) said his immigration policies were good (two) or good (five), particularly in creating the business conditions needed to succeed, but more CFOs (nine) rated them “poor.”
Among CFOs, President Trump’s Treasury Secretary Scott Bessent outperformed the president, with 62% rating his performance as “good” or “excellent,” and only one CFO deemed Bessent’s job performance “poor.”
On the pressing matter of President Trump’s plan to name a new Fed chairman to replace Jerome Powell, most CFOs say they don’t expect the move to have the positive impact the president envisions. 77% doubt a new chairman will make the Fed “more effective.”
More than half of CFOs expect inflation to remain above the Fed’s target through 2027, and although they expect rate cuts, they do not expect an aggressive rate cut cycle in 2026. CFOs expect at most one or two rate cuts by the middle of next year, with the exception of this week’s December FOMC meeting, where a rate cut is expected. This is in line with current market expectations and distances itself from calls for further rate cuts from President Trump and from Stephen Milan, who was recently added to the Federal Reserve Board and FOMC voting members, for huge rate cuts. National Economic Council Chairman Kevin Hassett, who is seen as a potential candidate to lead the Fed, recently called for a 25 basis point rate cut this week.
