US small-business optimism eases on economic expectations
A weakening in hiring plans and a smaller share of companies reporting job openings weigh on the index
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[WASHINGTON] Sentiment among US small-business owners edged down in January for the first time in three months, as optimism about the economic outlook eased.
The National Federation of Independent Business optimism index slipped 0.2 point to 99.3, based on figures released on Tuesday (Feb 10). Seven of the 10 components that make up the gauge decreased, while three increased.
The net share of owners who expect business conditions to improve fell three points to 21 per cent, after climbing to a four-month high in December. An easing in hiring plans and a smaller share of companies reporting job openings also weighed on the index.
At the same time, a net 16 per cent of owners said that they expect inflation-adjusted sales to improve in the next three months, up six percentage points from December and the largest share in a year.
Also, 15 per cent of owners reported that now would be a good time to expand their business, the highest percentage in six months.
The net share of owners raising their average selling prices fell to a three-month low of 26 per cent, suggesting only a gradual easing of inflationary pressures.
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However, this remains well above the historical average of a net 13 per cent. A larger share of firms also say that they are planning price increases in the next three months.
Meanwhile, the group’s measure of uncertainty rose seven points to 91. Taxes continued to rank as the single most important problem for small firms, followed by the quality of labour. BLOOMBERG
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