The following report was prepared by Ted Mallett, Vice-President & Chief Economist, Canadian Federation of Independent Business.

Business confidence among owners of Canada’s small and mid-sized enterprises (SMEs) fell back in April. In its latest reading, CFIB’s Business Barometer® Index dropped to 66.4 from its March level of 69.9. These views suggest that the torrid pace of overall economic growth seen last winter is beginning to cool to more sustainable rates.

Measured on a scale between 0 and 100, an index level above 50 means owners expecting their business’ performance to be stronger in the next year outnumber those expecting weaker performance. According to past results, index levels normally range between 65 and 75 when the economy is growing.

Optimism has fallen in 8 of 13 industry groups, including the bellwether sectors of manufacturing, construction, wholesale and retail trade. Slight improvements in confidence are seen among business owners in agriculture, transportation, finance, professional services and hospitality, but generally only to a small degree. Many consumer-driven businesses in Ontario and British Columbia are bracing for the looming harmonization of sales taxes in those provinces on Canada Day, and Nova Scotia businesses will be seeing a two-point rate increase in the HST rates they have to charge.

The full report is available at: http://www.cfib-fcei.ca/cfib-documents/rr3113.pdf.