The Small Business Optimism Index reported by the National Federation of Independent Business rose 2.1 points in June to 97.4, just below the survey’s 52-year average of 98.0, beating expectations of 95.8. The gain reversed May’s slide to 95.3 and was driven primarily by improved expectations for better business conditions and higher real sales, rather than by current conditions. The survey also found that 22% of business owners reported borrowing regularly in June — a lower share than the historical average of 34%.
The ABA Office of the Chief Economist views the June rebound as an encouraging development for commercial and industrial lending. However, high interest rates and a depressed share of business owners borrowing suggest that credit demand is unlikely to pick up in the near future.
