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Chief Executive outlook for US economy rises in first quarter

[WASHINGTON] Business leaders in the US adopted a more optimistic outlook in the first quarter as sales projections for the next six months reached a three-year high and capital- spending plans also advanced.

The Business Roundtable's composite CEO economic outlook index, which measures corporate leaders' forward-looking assessments of sales, investment and employment, rose to 90.8 from 85.1 in the last three months of 2014, the group said Tuesday in Washington.

A strengthening labor market and persistently low fuel costs have given the American consumer greater purchasing power to help drive demand. Executives in the survey projected the US economy will expand 2.8 per cent in 2015, up from last quarter's 2.4 per cent forecast.

"The US economy and the job outlook are starting the year in a stronger position than 2014," Randall L. Stephenson, chairman of Business Roundtable and chief executive officer of AT&T Inc, said in a statement.

"We need to give more businesses the confidence to increase investment to create more good-paying, middle-class jobs and boost US economic growth."

The survey, completed between Jan 26 and Feb 13, included responses from 120 CEO members of the trade group, which represents a workforce of almost 16 million and annual revenue of US$7.2 trillion.

Figures greater than 50 for the group's index indicate economic expansion, and the gauge's long-term average is 80.5.

Eighty per cent of respondents said they expect receipts to grow in the next half year, compared with 74 per cent the prior period, the group said. A greater share of executives, 45 per cent, also said they plan to increase capital spending in the next six months, up from 36 per cent in the fourth quarter.

Hiring plans were little changed, with 40 per cent of executives responding that they planned to increase headcounts over the next six months.