The Creighton University Rural Mainstreet Index climbed above growth neutral in August for a seventh straight month. The monthly survey of bank CEO’s in ten Midwestern states climbed to 54.8 from 53.8 in July. The index ranges between 0 and 100 with 50.0 representing growth neutral.
Organizer Ernie Goss says recent surveys show the Rural Mainstreet economy is expanding outside of agriculture, but “the negative impacts of recent trade skirmishes have begun to surface.”
In reaction to weak farm commodity prices and income, almost one-third, 31 percent, of bank CEOs reported rejecting a higher percentage of farm loans. More than half, 54 percent, indicated raising collateral requirements, while 4.8 percent reported reducing the size of farm loans. Borrowing by farmers expanded for August, but at a slower pace than in July, as the loan-volume index declined to 72.2 from 76.9 in July.
The confidence index, which reflects expectations for the economy six months out, rose to a weak 46.5 from July’s 42.7, indicating a pessimistic economic outlook among bankers.
Source: National Association of Farm Broadcasting News Service.