When I record guitar, the sound coming from the microphone is still low even when the input is turned up to max. Why this is, as other people don't seem to have their audio interfaces turned up this much? I am using a Shure SM57 and a Presonus Audiobox 2 in, 2 out. Do I need phantom power to boost the signal?
If the signal is 5–10 dB below max in your DAQ it's good – you need that headroom for louder sounds. What is a problem that you need to crank the input gain to the maximum to get that. This results in amplification of analogue noise.
Acoustic guitars are not very loud and dynamic microphones have limited sensitivity. This might be the best you can get from this equipment. I found this thread: https://www.gearslutz.com/board/newbie-audio-engineering-production-question-zone/1108511-why-does-my-sm57-need-so-much-gain.html discussing issues similar to the one you have.
Placing the microphone 1 foot away from the 12th fret seems to be reasonable to capture natural sound of the instruments. Classical guitars are often recorded at even larger distance.
However, with your present equipment reducing this distance might be your only chance to get stronger signal. This requires some trial and error. In particular you may want to avoid fretting hand noises, and boomy sound from the sound hole.
I once tried placing the microphone against the soundboard. I had to try several spots, and it still sounded a bit unnatural (nasal), but the results could have been acceptable for some types of recordings.
*Record with two microphones at the same time. The are lots of thecniques on internet, like 1 mic on 12th fret and another mic on the guitar hole
*Use Reafir plugin by Reaper or Isotope RX to remove noise you hear from the silence (air, computer, electricity...)
*As the noise is reduced, the headroom increases. You have more space to volume up again
*Use Multiband Conpressor and/ou Harmonic Exciter