Under the Microscope
Financial Professionals Believe Bottom Has Been Hit, Sentiment Improving
MOUNTAIN VIEW, Calif.-The economy has hit the bottom and businesses are feeling better about current conditions, according to a quarterly study by Adaptive Planning and the BPM Forum.
This is the fifth Business Volatility & Variables quarterly survey for Adaptive Planning, a provider of on-demand budgeting, forecasting, and reporting solutions. Responses from financial professionals from companies of all sizes across 20 industries found the Index of Current Conditions to be 52.25, up from 44.5 in the previous quarter. It was the third consecutive quarterly increase for this index, and the first time there have been more positive responses than negative-dating back to the first poll in October 2008.
The Index of Future Expectations was 58.75, which Adaptive Planning said indicated a mix of "same" or "better" outlooks. This index has been flat for three quarters (the previous two marks were 58.25 and 59.25).
Half of respondents expect a "double-dip" recession, with recovery not until the second half of 2010, or later. Only 33% expect "meaningful improvement" in jobs growth this year.
For info: www.adaptiveplanning.com or www.bpmforum.org
MRI Analysis: Short-Term Bank Deposits Yielding Net Loss For Depositors
SAN ANSELMO, Calif.-New analysis from Market Rates Insight, a research firm that tracks rates for deposits, loans, and fees for financial institutions, found term deposits that were opened in 2009 and matured in December 2009 or later are yielding net negative return when adjusted for inflation.
November 2009 marked a turning point between a deflation of -0.18% to inflation of 1.84%, the firm said.
The findings also point to a growing concern among depositors about the impact of higher inflation on the buying power of their money. For example, a 12-month CD of $10,000 obtained in January 2009 at the national average rate of 1.59 would have matured in December 2009 with a net negative return of -1.13%. This means the buying power of this $10,000 deposit was reduced to $9,887 when it matured in December. This decline in buying power is a reflection of the increase in the Consumer Price Index (CPI) from January to December 2009 as measured by the Bureau of Labor Statistics.
For info: www.marketratesinsight.com