The findings of the Global Economic Conditions Survey, conducted by the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA) and released on July 21, highlighted the continued impact of the conflict in the Middle East on global business sentiment. The survey was conducted between 3-17 June, before the renewed fighting and resumption of the US naval blockade.

Over three-quarters of accountants globally reported increased operating costs in the second quarter (Q2), above the previous record set in the aftermath of Russia’s invasion of Ukraine, amid soaring commodity prices and supply chain disruptions resulting from the conflict. Strikingly, 83 per cent of CFOs experienced increased costs, following a record-breaking rise of over 20 percentage points from Q1. This is close to series peaks recorded in 2022 and 2023.

Despite soaring costs, there was some recovery in confidence among accountants globally in Q2, from what was close to a record low in Q1. While they remain quite downbeat by historical standards, the improvement likely reflects the relative resilience of the global economy and signs at the time of the survey of movement towards a potential resolution of the conflict, which may have reduced fears of worst-case scenarios.

That said, declines in the Global New Orders, Capital Expenditure and Employment indices point to some slowing in global growth, likely reflecting headwinds from increased private sector caution, rising inflation, and tighter-than-expected monetary policy, although they do not appear to be signalling a major economic slowdown.

Confidence among accountants remains weak by historical standards in North America and Western Europe, but after a sharp recovery in Q2 is now meaningfully above average in Asia-Pacific. While the region is very exposed to developments in the Middle East, hopes of a potential resolution of the conflict and the relative resilience of the global economy have likely been factors boosting sentiment, as well as the global AI boom, of which the region’s exporters are major beneficiaries.

Economic pressures returned as accountants' top risk priority in Q2 2026, at 22 per cent, ahead of geopolitical instability at 20per cent and cybersecurity at 14 per cent. Respondents described how understanding today's risk landscape extends beyond traditional economic cycle management, pointing to the converging effects of prolonged wars, rising cybercrime and policy uncertainty. AI featured prominently, with comments focusing on sustainable value, cyber resilience and accountability.

“The AI boom is providing major support to the global economy and financial markets, but developments in the Middle East over coming months will be crucial. If progress can be made in resolving the conflict, that would clearly be supportive for global growth as we progress through the second half of 2026. But downside risks would quickly build if there were a return to major hostilities and surge in energy prices,” said Alain Mulder, senior director, Europe Operations and Global Special Projects at IMA.

Jonathan Ashworth, chief economist at ACCA, noted that sharply rising costs were a major issue for firms in the second quarter.

"If they increasingly try to pass these on to consumers, this would significantly raise the risk of policy tightening by the world's major central banks," Ashworth said. "That said, policymakers will be hoping for favourable developments on the diplomatic front and a return of oil prices to around pre-crisis levels, potentially allowing them to sit on their hands for the rest of 2026."

"Despite some improvement in confidence, accountants globally remain very cautious, likely reflecting the uncertain operating environment which has become the 'new normal' in recent years," he added.