Sharp drop in US business activity raises recession fears — AICPA

US business optimism fell sharply in the second quarter, showing a significant deterioration from the first few months of the year. According to a May survey by the Association of International Certified Professional Accountants (AICPA), only 27% of executives are confident about the economic outlook for the next year.

Tom Hood, an executive vice president at the AICPA, noted that companies are acting cautiously by delaying investments and hiring. Growing uncertainty surrounding the Trump administration's trade policies and new tariffs is forcing businesses to adjust their growth plans. As a result, expected revenue growth has fallen to its lowest level since the pandemic, at just 1%, while projected business losses reached 0.3% amid a drop in expansion plans.

Tensions with China renewed after the US President accused Beijing of violating the agreement have further reinforced negative expectations. More than a third of surveyed executives now expect a recession before the end of the year, while one in five believe the economy has already fallen into it.