Good morning. Alicia Adamczyk here filling in for Sheryl. Prior to this year’s presidential election, tariffs weren’t really on the average CFO’s mind. But now, with President-elect Donald Trump pledging to impose wide-reaching tariffs once in office, they’ve become one of the top concerns for finance chiefs heading into the new year.
That’s according to the most recent CFO survey from Duke University and the Federal Reserve Banks of Richmond and Atlanta, which polled around 500 CFOs pre- and post-presidential election to get a sense of how their priorities are shifting with the incoming administration. Monetary policy, labor quality and availability, and inflation topped the list of concerns post-election, while tariffs entered the top 10 list for the first time. Before the election, just 3% of finance executives mentioned the topic; post-election, the share more than quadrupled, to 14%.
While the tariff concerns suggest CFOs are becoming uneasy with the macroeconomic environment, that's not necessarily the case: CFO optimism about the overall U.S. economy and their own company’s performance increased following the election, with smaller firms more optimistic than larger ones.
But tariffs are the one dark spot in this otherwise rosy outlook: Firms that ranked trade policy as the most pressing concern also reported significantly lower levels of optimism for their own firm’s performance and the overall economy’s. Those CFOs are worried about the possible impact on growth and earnings.
There’s good cause for concern. After winning the election, Trump has said one of his first executive orders would be to impose a 25% tariff on imports from Canada and Mexico and a 10% increase of existing tariffs on goods from China. With companies—and eventually consumers—footing the bill, some executives are already preparing for price hikes and even fewer products to be on shelves. A report from the right-leaning Tax Foundation found the proposed tariffs would reduce GDP by at least 0.4% and eliminate almost 345,000 jobs.
Still, it was a smaller share of executives who expressed concern about a looming trade war—one that might not even happen. Most firms are feeling good, thanks to what they think will be more corporate-friendly tax and regulatory policies to come from the second Trump administration. After Q1 2025, we'll have a clearer look at how things are actually playing out.
Alicia Adamczyk
alicia.adamczyk@fortune.com
The following sections of CFO Daily were curated by Greg McKenna.
