Rural Mainstreet Index Stays in Growth Territory
Creighton University’s Rural Mainstreet Index stayed above growth neutral for the seventh month in a row. The monthly survey of bank CEOs in areas that rely on agriculture and energy shows that the June index fell to a still strong 70.0 from May’s record high of 78.8. The index ranges from 0 to 100, with growth neutral at 50.0. Almost half of the bank CEOs say their local economy expanded between May and June. Dr. Ernie Goss, Mainstreet Index chief, says, “Strong grain prices, the Federal Reserve’s record-low interest rates, and growing exports have underpinned the Rural Mainstreet economy. Even so, current rural economic activity remains below pre-pandemic levels.” While the index number is still solid, several bank CEOs raised future concerns this month. Steve Simon of South Story Bank in Iowa says, “Continued dry conditions will start to affect markets and crops soon.” Bankers were asked to list what they thought would be the greatest threat to 2021-2022 bank operations. Approximately one quarter said a downturn in farm income, and another one-in-four named rising government regulation. For the ninth straight month, the farmland price index also advanced significantly above growth neutral, coming in at 75.9 in June.
(Story Courtesy of the NAFB News Service)