Confidence among global accountants declined for the third quarter in a row in early 2025, remaining at its lowest since 2020, according to the Q1 2025 Global Economic Conditions Survey (GECS).

Highlights and the full report are available at https://www.imanet.org/about-ima/gecs.

The quarterly survey from ACCA (the Association of Chartered Certified Accountants) and IMA^® (Institute of Management Accountants) indicates that confidence fell markedly in North America amid a huge fall in the U.S., with confidence among U.S.-based accountants at its second lowest level recorded since GECS launched in 2011, and confidence among North America-based accountants at its lowest.

The survey of accountants took place between late February and mid-March, and so was completed in the build up to last week's major announcement by the U.S. on import tariffs, which significantly increased the downside risks to the global economy.

Commentary from survey respondents suggests that U.S. trade policy has been the key factor weighing on sentiment, as well as cuts in government spending. Expectations for increases in the latter have fallen sharply in recent quarters. Moreover, the U.S. Capital Expenditure and Employment indices both declined and are at very low levels historically. More encouragingly, the U.S. New Orders Index rose again and is not too far below its average.

Elsewhere, there were decent gains in confidence in Asia Pacific and Western Europe, after sharp falls in previous quarters, despite the growing risk from U.S. import tariffs. Meanwhile, cost pressures increased globally, remaining very elevated in Western Europe and rising quite materially in North America.

"Global growth has generally proved quite resilient over recent quarters. Nonetheless, the longer that confidence remains depressed, the greater the risk that a self-reinforcing negative cycle could potentially develop, with firms pulling back on orders, capital expenditure and hiring," said Jonathan Ashworth, Chief Economist, ACCA. "Unfortunately, with global trade tensions stepping up markedly since the survey was completed, the downside risks to the global economy have increased significantly."

"New U.S. policies on trade and government spending, and the uncertainty surrounding them, appear to have had a large negative impact on confidence, while declines in the stock market and signs of slowing in the U.S. economy were likely factors too," said Alain Mulder, Senior Director Europe Operations & Global Special Projects at IMA.

The highest overall risk identified by accountants in Q1 was the economy, but responses varied across sectors. Cybersecurity was the highest risk for financial services, tied in first with talent scarcity for the public and not-for-profit sector. The corporate sector ranked economic woes first and geopolitical instability a tight second. Geopolitical risks came in second overall – the first time GECS recorded it above third – with respondents in the U.S. especially, commenting on the implications of new policy changes and tariffs.

Read the full survey here: https://www.imanet.org/about-ima/gecs.