Citizens Business Conditions Index™ Rises in Q4

Resilient labor market supports momentum into 2024

The national Citizens Business Conditions Index™ (CBCI) rose to 51.8 in the fourth quarter, supported by continued resilience in the labor market and consumer trends. The second consecutive quarterly reading above 50 indicates that the economy exited 2023 with momentum as signs of moderating inflation support optimism for a soft landing.

While applications for new businesses were slightly softer during the period, solid employment trends, particularly in Local Government and Healthcare, contributed to improving economic conditions in the fourth quarter. Citizens’ proprietary data on client revenue also remained strong across most industries. Healthcare and Consumer Services were once again among the top sectors, while the Basic Materials and Energy sectors faced headwinds during the period.

“The U.S. economy is entering 2024 on solid footing as the labor market has remained resilient and inflation has showed signs of normalizing,” said Eric Merlis, managing director and co-head of global markets at Citizens. “Moving forward, all eyes will be on the Fed and the timing and pace of rate cuts in the year ahead. We are working closely with our clients to help them navigate these changing circumstances and take advantage of them.”

The underlying components of the Index showed a moderate improvement in the business environment during the fourth quarter. Two of the five components provided a boost to the Index, while two were neutral and one weighed on the reading.

  • Solid employment trends, as measured by initial jobless claims, were a tailwind.
  • The ISM non-manufacturing component remained expansionary as consumers continued to spend on travel and recreational services.
  • The revenue data of Citizens Commercial Banking clients varied across regions as businesses in some geographies faced idiosyncratic headwinds during the quarter.
  • New business applications were marginally lower but remain elevated.
  • The ISM manufacturing component was contractionary for the fifth consecutive quarter.

Overall, the fourth quarter CBCI revealed a business environment that is reverting toward its long-term growth trend. While operating conditions remain mixed, the reading provides an optimistic starting point for 2024.

“The fourth quarter CBCI shows a business environment that continued to improve despite ongoing challenges in the macro environment during the period,” said Merlis. “Citizens’ middle market and mid-corporate clients have remained resilient and, as we head into 2024, the tailwinds continue to be stronger than the headwinds.”

Citizens is a trusted strategic and financial adviser, consistently delivering clear and objective advice. The Citizens approach puts clients first by offering great ideas combined with thorough market knowledge and excellent execution, to help our clients enhance their business and reach their potential. For more information, please visit the Citizens website.

About Citizens Financial Group, Inc.

Citizens Financial Group, Inc. is one of the nation’s oldest and largest financial institutions, with $222.0 billion in assets as of December 31, 2023. Headquartered in Providence, Rhode Island, Citizens offers a broad range of retail and commercial banking products and services to individuals, small businesses, middle-market companies, large corporations and institutions. Citizens helps its customers reach their potential by listening to them and by understanding their needs in order to offer tailored advice, ideas and solutions. In Consumer Banking, Citizens provides an integrated experience that includes mobile and online banking, a full-service customer contact center and the convenience of approximately 3,200 ATMs and approximately 1,100 branches in 14 states and the District of Columbia. Consumer Banking products and services include a full range of banking, lending, savings, wealth management and small business offerings. In Commercial Banking, Citizens offers a broad complement of financial products and solutions, including lending and leasing, deposit and treasury management services, foreign exchange, interest rate and commodity risk management solutions, as well as loan syndication, corporate finance, merger and acquisition, and debt and equity capital markets capabilities. More information is available at or visit us on X (formerly Twitter), LinkedIn or Facebook.


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