Optimism among small U.S. businesses soared to a seven-month high in May.

The National Federation of Independent Business said Tuesday that its optimism index increased 1.5 points to 105 on improved views of the economy, employment, capital outlays and sales.

“Optimism among small business owners has surged back to historically high levels, thanks to strong hiring, investment, and sales,” said NFIB President and CEO Juanita D. Duggan.

The survey is the first taken since President Donald Trump hiked tariffs on $200 billion of Chinese goods to 25 percent.

Six of ten survey components improved, three were unchanged, and only one declined in May.

More than two-thirds reported spending on capital equipment, the best since February 2018. Thirty percent reported plans to invest in the next few months. Plans to invest were most frequent in transportation, manufacturing, professional services, and construction. This is a powerful indicator that small businesses expect the economy to continue to grow in the months ahead.

“Small business owners are demonstrating a continued confidence in the strength of the economy and are betting capital spending dollars on it,” said NFIB Chief Economist William Dunkelberg.

Nearly two-thirds of small businesses reported hiring or trying to hire in May. Fifty-four percent said that they found few or no qualified applicants for positions they were trying to fill.

Inflation pressures remained subdued, suggesting that businesses are not passing along costs of tariffs to consumers. Businesses saying they are raising their prices fell to a net 10 percent and fewer said they have plans to raise prices.

The only component that declined was expected credit conditions. That’s an indicator that businesses think lending is tightening.