James Smith, Economist at ING, notes that the February was another bad month for the US NFIB small business survey, which continued a downtrend that began at the start of 2015. Key Quotes “The NFIB small business survey fell by another point to 92.9 in February, reflecting lower sales expectations, actual earnings over the past 3 months and less firms believing that this is a good time to expand. This survey is volatile and many of the components fluctuate quite a bit, but the overall survey has been trending downwards for over a year now. Much of the recent downtrend has been caused by the outlook for business conditions component, which has been tracking the ISM manufacturing quite closely (with a slight lag) and continued to do so in February. It is also worth noting that many factors can affect small business sentiment (many of which are non-economic) and stock prices, as is the case with consumer confidence, can play a role. Incidentally, if January/February’s stock market fall played a part, then the recent rebound may lift this index over the next month or two. This survey, although often overlooked in favour of the ISM data, is perhaps a more accurate reflection of the domestic economic story given that (a) small firms punch above their weight in terms of contribution to job growth and (b) are more domestically focussed (so less affected by weaker external demand). Thus, it is worth keeping an eye on this index over the coming months to see how it evolves.” For more information, read our latest forex news.