The Creighton University Rural Mainstreet Index fell for the fourth straight month, sinking below growth neutral for a second consecutive month according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
The region’s overall reading for July slumped to 46.0 from 49.8 in June. The index ranges between 0 and 100 with a reading of 50.0 representing growth neutral. This was the fourth consecutive decline in the region’s overall reading.
“The Rural Mainstreet economy is now experiencing a downturn in economic activity. Supply chain disruptions from transportation bottlenecks and labor shortages continue to constrain growth,” says Creighton Economics Professor Dr. Ermie Goss. “Farmers and bankers are bracing for escalating interest rates, both long-term and short-term.”
Bankers were asked this month to identify the greatest risk for farmers over the next 12 months. Regarding the top risks, 53.9% named rising input prices, 34.6% indicated falling grain/livestock prices and 11.5% reported drought was the top threat.