Creighton University’s March Rural Mainstreet Index slipped to a negative value as bankers actively encouraged interest rate hikes and farmland values remained elevated.
The value slip comes after three months of hovering at growth-neutral – 50 on a scale of 0-100. The latest value is 45.6.
According to the monthly report of bank CEOs from a 10-state region dependent on agriculture or energy, approximately 87% of respondents recommend the Federal Reserve raise interest rates at its upcoming March meeting. Almost one-third of surveyed bankers support a 0.50% increase.
Jeffery Gerhart, former chair of the Independent Community Bankers of America, applauded recent rate increases but remains disappointed in how long they have taken. “They could have begun raising interest rates sooner than they did and would not have had to raise them as fast as they’ve done,” he said.
At the same time, the index for certificates of deposit and other savings instruments skyrocketed to a record reading of 75 on a scale from 0-100. February’s reading was 57.7.
Don’t miss a beat! It’s easy to sign up for a FREE month of Agri-Pulse news! For the latest on what’s happening in Washington, D.C. and around the country in agriculture, just click here.
Farmland prices have now increased for 30 consecutive months. Values rose by 9% in 2022, but surveyed bank CEOs expect only 1% growth over the next 12 months.
Surveyed bank CEOs hail from Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming. Creighton University compiles the index monthly to monitor the health of the rural economy.
For more news, go to www.Agri-Pulse.com.
