From Deloitte’s quarterly CFO survey today:
CFOs entered 2014 full of optimism but the position is far more subdued as we move into 2015. Whilst there are modest signs of positive growth, genuine momentum and confidence are in short supply.
The year ended with a greater sense of caution for Australian CFOs. With just over a quarter of CFOs thinking now is a good time to take greater risk onto their balance sheets, they appear to be preparing for an uncertain future.
Decisions on pursuing growth strategies are focused around safe choices such as organic expansion and introducing new products or services. Interestingly, over half of the CFOs surveyed indicated their companies are more risk-averse than the rest of the market. This poses the question: are we too risk-averse to successfully compete in a growing globalised world?
On a positive note, continuing low interest rates and the falling Australian dollar are likely to help many Australian corporates. However, global uncertainties, weaker commodity prices and ongoing political policy debate continue to weigh heavily on confidence.
CFOs continue to face a challenging environment, but that’s nothing new.
The big question is what will shift the needle? The Australian dollar, growth in China, domestic politics or something else?
One gets the feeling that the uncertainties of the second half of 2014 may continue well into 2015. Let’s hope not.
The needle will shift, yes, to worse. Here are the charts. The much loved “confidence”:
China the main weight intenationally:
Abbott and Hockey the main weight locally:
Just say “no” to risk:
Not happy, Jan, though not as bad as the pre-election period:
Looks like a new leadership team could have some impact, assuming they are competent.
