U.S. Recession Has Already Started, CFOs Say

NEW YORK (Reuters)- A U.S. recession has already started and the downturn is likely tolast longer than in the recent past, with the economy recovering onlylate next year, according to a quarterly survey of corporate financechiefs released on Wednesday.

Fifty-four percent of the CFOs said the United States is inrecession, and another 24 percent said there is a high likelihood ofone starting later this year, according to a Duke University/CFOMagazine survey completed on March 7.

Nearly three-quarters of the CFOs said they were more pessimisticthis quarter than in the prior quarter about the U.S. economy,reflecting concerns about consumer spending, turmoil in credit andhousing markets, and high energy prices.

An index of optimism, which rates the economy on a 1 to 100 scale,is at 52, the lowest in the seven-year history of the index, the surveyfound.

"The last two recessions lasted only eight months," said Dukeprofessor Campbell Harvey, founding director of the survey. "Incontrast, 90 percent of the CFOs do not believe the economy will turnthe corner in 2008. Indeed, many of them believe it will be late 2009before a recovery takes hold."

In response, companies are scaling back plans for capital spendingand are not planning significant hiring, in part because of high laborcosts, according to the survey, which has been conducted for 12 years.

Most CFOs said interest rate cuts by the U.S. Federal Reserve havehad no impact on their business, and more than a third said creditconditions have directly hurt their companies by making capital tougherto get and more expensive.

The survey included responses from 1,073 CFOs, including 475 based in the United States.

Those polled in Europe and Asia have also grown more pessimisticabout economies in their regions, while two-thirds of Chinese CFOs saidthey are concerned about U.S. recession hurting their profit margins ordemand for their exports.

(Reporting by Nick Zieminski; Editing by Steve Orlofsky)