Key Takeaways

  • The American Institute of CPAs (AICPA) said Thursday that CEO and CFO optimism about the economy and future profits rebounded in the first quarter of 2026 compared with the previous quarter (Q4), prompting 55% of surveyed executives to plan more aggressive expansion moves in the coming months.
  • The AICPA said 39% of CEOs, CFOs, controllers, and other finance executives expressed optimism about the economic outlook, up 11 percentage points from Q4. Optimism about their own companies' prospects rose 6 percentage points to 47%. The survey was completed last month and conducted jointly by the AICPA and the Chartered Institute of Management Accountants (CIMA), prior to the outbreak of the Middle East conflict.
  • "Business leaders are feeling a renewed sense of optimism this quarter," said Tom Hood, vice president of the Association of International Certified Professional Accountants, in a statement. "That said, we are mindful that recent geopolitical developments could impact inflation trends. Even amid uncertainty, the steady rise in business prospects and expansion plans suggests executives are positioning for growth."

Deeper Dive

The AICPA/CIMA findings align with a Conference Board survey, which found the share of CEOs planning to increase capital spending this quarter jumped to 35% from 22% in the prior quarter. Their confidence reached its highest level in a year.

Economists noted that if the Middle East conflict persists beyond a few weeks, it could undermine executive confidence by pushing up energy costs, fueling inflation, and weighing on economic growth.

Since last Saturday (February 27), strikes by U.S. and Israeli warplanes on Iran have pushed up prices for crude oil and other energy commodities. Brent crude futures have risen about 16% from $73 per barrel on February 27 to $85 per barrel.

"None of this is good for the economy because higher oil prices will weigh on growth and push up inflation," Mark Zandi, chief economist at Moody's Analytics, said on LinkedIn about the regional conflict. "This in turn will intensify affordability concerns for Americans and complicate monetary policy implementation, as the Fed will be uncertain whether to cut rates in response to weak growth or raise them in response to higher inflation," he added.

Zandi noted that for every sustained $10 increase in the price of a barrel of oil, the price of regular gasoline rises by 25 cents and pushes inflation up by 0.15 percentage points a year later. The higher costs also reduce economic growth by 0.10 percentage points.

According to the AICPA/CIMA survey, before the outbreak of hostilities in the Middle East, expectations among CEOs, CFOs, and other finance executives for revenue growth over the next 12 months rose to 2.9% in Q1 from 2% in Q4. Profit growth expectations rose to 1.6% this quarter from 0.8% in the previous quarter.

The AICPA and CIMA said expectations of lower borrowing costs and pro-growth economic policies boosted respondents' optimism.

The One Big Beautiful Bill Act, signed into law in July, permanently extended lower marginal tax rates on work, savings, and investment and introduced several temporary tax cuts. According to an analysis by the Tax Foundation, the law—though partially offset by the Trump administration's tariffs—could boost long-term economic growth by about 1.2% annually.