The Creighton University Rural Mainstreet Index declined slightly in January from December’s weak reading, remaining below growth neutral. However, organizers say the monthly survey of rural bank CEO’s in the Midwest is significantly higher than the reading for January 2017.
The index, like all indices in the survey, ranges between zero and 100 with 50 representing growth neutral, fell to 46.8 from 47.8 in December. Organizer Ernie Goss says “the negatives are getting less negative,” but bankers still say loan defaults are the biggest challenge for 2018. The farmland sub-index rose three points to 42.2, remaining below growth natural for now 50 months, and the January farm equipment-sales index slumped to 24.4 from December’s 29.3. Confidence indicated by the rural bankers also slipped below growth neutral to 46.7 from 51.2 in December, indicating a deterioration in the economic outlook among bankers.
Bankers say they are concerned about trade, specifically the North American Free Trade Agreement, and the continued low commodity prices impacting farmers.