U.S. small business optimism is likely to receive a boost from the Phase I trade deal with China, which was announced by the Office of the U.S. Trade Representative on 13 December, noted Wells Fargo in a research report.
Equity markets celebrated the deal, but small firms generally have less exposure to foreign economies and international trade. However, small businesses owners lean disproportionately Republican, so the impeachment of President Trump – which was approved in the House on 18 December- might be giving them some pause.
Nevertheless, optimism continues to be quite high on a historical basis, underpinning the view that Main Street and the consumer continue to be healthy.
According to consensus expectations, the NFIB small business optimism index is likely to have risen slightly to 104.8 in December from 104.7 in November.
