The NFIB's latest sentiment index dropped to 89.9, the largest fall since December 2022. Small business owners are adjusting to economic challenges, particularly inflation. Job openings have decreased slightly, with only 39% reporting unfilled positions, the lowest since January 2021. Plans for new hires are at an eight-year low, despite job openings reaching pre-pandemic levels. Inflation remains a concern, with 22% of owners raising prices. 20% cite inflation as the most significant operational challenge, down slightly from the previous month. The market reacted negatively to a hotter-than-expected CPI report, pushing rate cut expectations to July. This aligns with NFIB's sentiment, indicating struggles for small and mid-cap businesses amidst slower growth and higher rates. Despite CPI exceeding forecasts, many contributing factors are seen as seasonal and temporary. The Fed's last rate hike in July 2023 suggests bond yields could continue falling, barring further hikes.