Rising geopolitical tensions, higher energy prices and persistent cost pressures are posing significant risks to the global economic outlook, even as business activity across Asia-Pacific remains relatively resilient, according to the latest Global Economic Conditions Survey (GECS) released by the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA).
The third-quarter 2026 survey showed the Asia-Pacific New Orders Index improved for a second consecutive quarter and moved close to its record high, while capital expenditure and employment indicators also strengthened, reflecting continued economic activity in the region.
However, business sentiment weakened during the quarter, with confidence among finance professionals falling sharply and reversing much of the gains recorded in the previous quarter. Despite remaining slightly above its historical average, confidence was affected by renewed geopolitical uncertainty and rising energy costs.
According to the survey, 24.1% of finance professionals in Asia-Pacific cited geopolitical instability as the biggest risk to economic growth, higher than the global average of 18.4%. Talent shortages and supply-chain disruptions also emerged as key concerns for businesses across the region.
Operating costs remained elevated, with 62% of respondents in Asia-Pacific reporting higher costs during the quarter, significantly above the long-term survey average. Expectations of tighter monetary conditions also rose, with 41% anticipating interest-rate hikes over the next three months, up from 30% in the previous quarter.
Globally, nearly 70% of accountants reported rising operating expenses, while almost half expected interest rates to rise, underscoring persistent inflationary pressures and concerns about higher financing costs.
Commenting on the findings, ACCA Chief Economist Jonathan Ashworth said Asia-Pacific continued to benefit from strong investment linked to the global artificial intelligence (AI) boom, supporting business activity and economic growth. However, he warned that further increases in energy prices, the expected impact of a strong El Niño weather pattern and a slowdown in AI-related investment could undermine growth prospects.
Alain Mulder, Senior Director at IMA, said the global economy faced competing forces, with AI-driven investment supporting expansion while rising energy prices, inflationary pressures, and higher government bond yields challenged businesses and policymakers.
The survey cautioned that sustained cost increases could force companies to pass on higher expenses to consumers, potentially weakening demand and increasing the likelihood of further interest-rate hikes by major central banks in the months ahead.