US small business sentiment deteriorates in March - NFIB
Small business sentiment in the US deteriorated more than expected in March, according to the latest survey from the National Federation of Independent Business.
The small business optimism index fell to 104.7 last month from 107.6 in February, missing expectations for a reading of 107.0 but still among the highest readings in survey history.
For the first time since 1982, taxes received the fewest number of votes as the number one problem.
NFIB president chief executive officer Juanita Duggan said: "It has been a remarkable 16 months for small business optimism.
"This is the first time in 35 years where the fewest number of small business owners have told us that taxes are their number one business problem. They’ve been so optimistic that they feel confident enough to raise wages and invest in their business, which grows the economy."
NFIB chief economist Bill Dunkelberg said that while expected sales and expected business conditions posted large declines, it was from historically high levels and this still left the overall Index reading among the 20 best in survey history.
"Hiring and spending on new buildings and land acquisition remained at strong levels, a good sign of confidence in economic prospects."
Most of the drop in the headline number was down to the economic and sales expectations components, which fell 11 points and eight points, respectively, a move Pantheon Macroeconomics economist Ian Shepherdson attributed to the drop in stock prices.
"We thought most of the hit from the stock market would appear in the April survey, given the usual lag, but the relationship between the market and the survey is not always stable. In the details, we are disappointed to see a three-point decline in capex plans, taking the index back to its post-hurricane low. If this persists, we'll have to moderate our forecasts for business investment spending this year, despite the tax cuts. "