Expectations for economic growth have fallen since the beginning of the summer according to the Business Roundtable, an association of CEOs from leading U.S. companies. From an index reading of 84.3 in the summer, the third quarter reading fell to 79.1.

A primary concern is the increasingly likely prospect that Congress and the President will not be able to forge an agreement on raising the U.S. debt ceiling. Failing to reach an agreement could force the U.S. to default on its national debt.

More than three-quarters of executives surveyed expect sales at their firms to increase in the next six months, but only 32% expect to hire more workers. About half the companies in the survey anticipate no change in capital expenditures.

Business Roundtable chairman and CEO of The Boeing Co. (NYSE: BA) Jim McNerney said:

CEO expectations for the next six months remain essentially the same with some downside bias. Expectations for sales and capital investment both declined modestly in this survey. While U.S. business performance remains strong, as evidenced by robust recovery in the automotive sector, business leaders still see headwinds preventing a more sustained, robust recovery.

Rising mortgage interest rates are not viewed as a threat to businesses, at least not yet. Though higher than they were a year ago, interest rates remain historically low and would have to rise substantially in order to hobble business.

In addition to the debate over the debt ceiling, the fiscal year 2014 federal budget has not been settled. In fact, serious discussion for next year’s budget has been almost entirely absent for a fiscal year that begins in less than two weeks. Whether or not a continuing resolution will be passed is another open issue. No real discussion of that has been reported yet either.

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