NEW YORK, Sept. 10 (Xinhua) -- U.S. small business confidence declined in August, amid rising uncertainty ahead of the presidential election and worsening expectations for business conditions, according to a survey released on Tuesday.
The Small Business Optimism Index fell by 2.5 points in August to 91.2 after the index surged in July to the highest reading since February 2022, the National Federation of Independent Business (NFIB) said in its monthly survey.
This was the 32nd consecutive month below the average of 98, the survey said.
The Uncertainty Index rose to 92 last month, reaching its highest level since October 2020.
"The mood on Main Street worsened in August, despite July's gains," said Bill Dunkelberg, NFIB chief economist. "Uncertainty among small business owners continues to rise as expectations for future business conditions worsen."
"The NFIB uncertainty index typically increases during presidential election years. However, it is rising much sooner and faster than normal, consistent with other measures of policy uncertainty," said Bernard Yaros, U.S. economist at Oxford Economics.
According to the survey, the share of small business owners expecting higher real sales volumes dropped nine points in August to a net negative 18 percent, making it the largest contributor to the decline in the Optimism Index.
Inflation remained the top issue among small business owners, the survey found. About 24 percent of owners reported that inflation is their single most important problem in business operating, down one point from July.
The decline in U.S. small business confidence reflected a worsening in earning trends, along with a deterioration in expectations for future sales and business conditions, TD Bank Financial Group said in a note on Tuesday.
"With the election at our doorstep, uncertainly among small business owners has been rising, with the corresponding subindex increasing further in August to a level that's now rivalling the highs experienced during the onset of the pandemic and those just prior to the 2016 election," it added.
