US small business confidence index improves in July, NFIB says

Confidence among America's small businesses improved last month, according to the results of a widely-followed survey, with many firms plotting higher prices.

The National Federation of Independent Businesses's small business activity index rose from a reading of 103.6 for June to 105.2 in July.

Economists had forecast a print of 103.5.

Commenting on the release, Ian Shepherdson, chief economist at Pantheon Macroeconomics, pointed out the increases seen in the subindices linked to hiring intentions and jobs 'hard-to-fill'.

Both hit new cycle highs, which Shepherdson said reflected that companies were having real trouble filling vacancies.

On a more disappointing note, he said, the sub-index linked to firms' investment plans gave back its gains from the previous month.

Sheperdson also noted the rise seen in the sub-index for selling price expectations, which hit a three-year high.

"Some of this reflects the rebound in oil prices, but our estimate of non-oil price expectations is now trending higher, after dropping sharply at the start of this year, just before the official core inflation began to fall unexpectedly.

"The NFIB data are not definitive, but they are consistent, at least, with the idea that the decline in core inflation will prove temporary."