Profit margins bring optimism, survey says

A higher percentage of U.S. companies
saw profit margins widen last quarter, making businesses
“upbeat” about the rest of the year, according to a survey by
the National Association for Business Economics.

Forty-one percent of the 104 companies responding said they
plan to increase hiring in the next six months, up from 34
percent in April, the quarterly survey found. In addition, 61
percent expect to boost capital spending during the next year, up
from 53 percent in the previous survey released in April.

“It doesn’t look like we’re at a point where we have to
worry about anything that might derail the economic recovery,”
said Duncan Meldrum, chief economist of Air Products & Chemicals
Inc. in Allentown, Penn., and president of the economics
group that conducted the survey.

More than a third of companies in the survey, 37 percent,
said profit margins widened in the second quarter, the highest
percentage since the fourth quarter of 1987.

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