It is likely that the negative impact of macroeconomic and geopolitical factors is slowly working through into expectations, if not yet actual business activity. The Federal Reserve has been cautious in its response to economic conditions, and widespread expectations of cuts in interest rates have only very recently materialised with its September large half point cut in interest rates, clearly intended to help avoid this potential recession in economic activity.

Sales Managers - the respondent base for this survey - are notorious for picking up the first warning signs of problems ahead. Delayed signatures on contracts, increasing hesitation in agreeing to significant expenditures, and a general slowing down sales activity levels can all contribute to sales managers falling confidence, for good if sometimes difficult to articulate reasons.

Until July many sectors of the American economy seemed to be largely untroubled by the anti-inflationary rises in interest rates, and the growing shadow of disturbing global political change. However, the evidence presented by the September Sales Managers Survey suggests that the Federal Reserve's previous policy of keeping interest rates high may at last be having a restraining impact on the "animal spirits" so important to continuing growth in economic activity levels.

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