| NFIB Small Business Optimism Index |
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Released On 2/14/2012 7:30:00 AM For Jan, 2012
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Prior | Consensus | Consensus Range | Actual |
| level | 93.8 | 95.0 | 94.5 to 96.8 | 93.9 |
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Highlights
Optimism among the nation's small businesses is improving but only very slightly, up one tenth to 93.9 in January. More expect the economy to improve and more job openings are being reported, but earnings trends are down as is sentiment on inventories which the NFIB panel expects to further reduce. While the index is up for a fifth straight month, the report warns that January's results are still recessionary and point to a slow and weak pace for economic growth.
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Market Consensus before announcement
The NFIB Small Business Optimism Index in December rose 1.8 points to 93.8 for a fourth straight monthly advance. Gains were centered in earnings, sales expectations, and expectations for economic improvement
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Definition
The small business optimism index is compiled from a survey that is conducted each month by the National Federation of Independent Business (NFIB) of its members. The index is a composite of ten seasonally adjusted components based on questions on the following: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect economy to improve, expect real sales higher, current inventory, current job opening, expected credit conditions, now a good time to expand, and earnings trend. The baseline of 100 is for the average of the year 1986. A positive percentage change indicates improvement while a negative percentage change in the index suggests a decline in optimism. But the level indicates optimism relative to 1986—a moderately healthy year for economic growth with annual average GDP growth at 3.5 percent.
Why Investors Care
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