U.S. small business optimism slipped again in February as owners grew more cautious about future sales and broader economic conditions, Bloomberg writes.
The National Federation of Independent Business’ optimism index edged down to 98.8, marking the second consecutive monthly decline and reflecting softening expectations across several key indicators. A major drag on sentiment was the outlook for sales. The share of owners expecting inflation-adjusted sales to improve fell sharply after reaching a one-year high in January, suggesting demand concerns are resurfacing.
Hiring plans also weakened, with the share of firms expecting to increase employment dropping to its lowest level since May—another sign that the small-business labor market may be cooling.
Despite the more cautious outlook, some indicators showed improvement. The share of businesses reporting positive profit trends climbed to its highest level since late 2021, and inflation pressures appeared to ease as fewer firms reported raising prices.
The survey was conducted before geopolitical tensions in the Middle East pushed gasoline prices higher, adding new uncertainty for small businesses heading into the spring.
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