Global businesses face sharp rise in operating costs during Q2: survey

KARACHI: Global businesses faced a sharp rise in operating costs during the second quarter of 2026, according to the latest ACCA and IMA Global Economic Conditions Survey (GECS). Conducted in June, the survey highlighted the continuing economic impact of the Middle East conflict, with soaring commodity prices and supply chain disruptions driving costs higher.

More than 75 percent of accountants around the world have reported increased operating costs in the second quarter of the year 2026, surpassing the previous record set after Russia’s invasion of Ukraine. Among the Chief Financial Officers (CFO), 83 percent experienced higher costs, marking a significant jump from the previous quarter and approaching the peaks seen in 2022 and 2023.

Despite mounting cost pressures, global business confidence improved modestly, from its near-record low in the first quarter of the year 2026, reflecting the resilience of the global economy and optimism surrounding a possible easing of geopolitical tensions. However, confidence remains below historical norms, particularly in North America and Western Europe, while Asia-Pacific recorded a strong recovery, supported by the economic boom driven by “Artificial Intelligence (AI).”

The survey also indicated a moderation in global growth, with declines in new orders, capital expenditure, and employment pointing to increased business caution, amid inflation and tighter monetary policy.

ACCA Chief Economist, Jonathan Ashworth noted that: “Rising costs could fuel inflation, if passed on to consumers, increasing the likelihood of tighter monetary policy. While confidence has improved slightly, accountants remain cautious in an increasingly uncertain global business environment.”

IMA’s European Regional Director, Alain Mulder said: “The AI boom continues to support global growth, but warned that developments in the Middle East remain critical to the economic outlook.”

“Economic pressures” emerged as the top risk priority (22 percent), according to the accountants’ analysis. It was followed by “Geopolitical instability” (20 percent) and “Cybersecurity” (14 percent). Respondents also highlighted AI as an increasingly important factor, particularly in relation to “Governance”, “Cyber Resilience”, and “Long-Term Value Creation.”

Copyright Business Recorder, 2026