AFP Corporate Cash Indicators™
Business confidence is gaining momentum as the pace of corporate cash accumulation decelerated during the first quarter of 2013, according to April 2013 AFP Corporate Cash Indicators™, a quarterly study that measures recent and anticipated changes in U.S. corporate cash balances. Fewer companies continued to build cash and short-term investment balances during the first quarter of 2013 relative to a year ago.
Even though the quarter-over quarter index increased from a reading of +5 to +10 during Q1, the index remained below the +13 reading of April 2012. The year-over-year indicator dropped to +8, its lowest reading in the history of the survey.
The forward looking indicator measuring expectations for increasing cash during the second quarter of 2013 remained negative as it ticked down a point to -5, which was only its third negative reading recorded in the history of the AFP CCI™.
The AFP Corporate Cash Indicators™ (AFP CCI™), underwritten by State Street Global Advisors, provide treasury and finance professionals, policymakers and market analysts with timely data on a determinant of economic activity: corporate cash levels. The AFP CCI™ is created and maintained by the Association for Financial Professionals (AFP), a professional society that serves corporate finance departments globally.
Methodology: On the opening days of each quarter, AFP asks select members whether their short-term investment holdings increased or decreased in the past year and past quarter; whether investment selections for those cash holdings changed in the last quarter; and whether they expect cash holdings to increase or decrease in the coming quarter. For consistency, AFP asks the same questions each quarter. AFP members have agreed to participate in this ongoing study on a long-term basis.
AFP’s research department began collecting quarterly data in January 2011. The next AFP CCI™ report will be published in the July 29, 2013 issue of AFP EconWatch newsletter.
AFP Corporate Cash Indicators™ is a trademark of the Association for Financial Professionals. All AFP Corporate Cash Indicators™ survey questions, data and reports are the copyrights of the Association for Financial Professionals, and all rights are reserved. For information about publishing the CCI on your site, please contact pr@afponline.org.