According to analysts from Wells Fargo, the decline in the National Federation of Independent Business (NFIB) small business optimism may have been influenced by the slide in equity prices. Key Quotes: “The National Federation of Independent Business (NFIB) small business optimism index tumbled 1.3 points in January to 93.9. Expectations for the economy, real sales expectations and hiring plans were among the largest detractors on the month. Global growth fears and fallout from financial market volatility may have weighed on expectations for growth in January.” “The hiring plans component fell four percentage points to a net 11 percent in January. This slower pace of hiring was consistent with January’s nonfarm payrolls report, which also showed a downshift in the pace of hiring. The labor market continues to tighten, which may be a factor contributing to the slowdown in hiring.” “We expect the labor market to tighten further in 2016, which should put further pressure on wages. This may lead to labor quality becoming an even larger issue for many small businesses.” “In addition, it appears as if firms continue to have little pricing power, as the NFIB’s press release noted “there was a lot of price cutting late in the year to boost sales and reduce inventories.” The weak nominal GDP growth we are expecting over the coming year should limit top-line growth for many firms, while further tightening in the labor market will increase costs. Tighter operating margins have been a key concern for small businesses throughout this expansion and are one of the reasons business owners have remained so cautious.” For more information, read our latest forex news.