Inflation's Back, Says CFO Survey.

• Position: Chief financial officer - Brief Article

A new poll of 304 companies predict prices will rise by 3.5 percent during 2000, up sharply from the 2.2 percent inflation predicted three months ago and more dramatically from the 0.8 percent inflation predicted one year ago. The numbers are from the latest FEI/Duke University Corporate Outlook Survey, conducted the week of March 13.

"One out of four firms says the recent run-up in the price of oil will cause them to increase the prices of their products, with the average price increase being 6 percent," says John Graham, a finance professor at Duke University and director of the survey. "The transportation and energy industries will be especially hard hit by the increase in the price of fuel, with CFOs in these industries expecting price increases of 9.5 percent."

Thirty-four percent of CFOs say the run-up in oil prices will dampen their firms' earnings. In particular, 43.3 percent of manufacturing and 42.2 percent of mining/construction firms say increased oil prices will hurt earnings.

Even so, CFOs remain optimistic about the bottom line. Earnings growth is expected to average 20 percent during 2000 -- attributable, at least in part, to continued strong growth in worker productivity. The median firm expects output per employee to...