Rural Mainstreet Wobbles Above Growth Neutral

The Creighton University Rural Mainstreet Index declined in February but remained above growth neutral.

This the sixth straight month the reading has moved above growth neutral, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

The overall index for February declined to 51.6 from 55.9 in January.

The February farm equipment-sales index increased to 37.9 from January’s 35.

Borrowing by farmers remained sluggish. The borrowing index rose to 50 in February from 48.5 in January, which was its lowest level since February 2013.

The employment gauge dipped to a still solid 57.8 from January’s very healthy 61.8. Despite the ongoing trade war and weaker manufacturing in rural areas, Rural Mainstreet businesses continue to hire at a solid pace.

The confidence index, which reflects bank CEO expectations for the economy six months out, increased to a healthy 58.1 from January’s reading of 50.

“The signing of the Phase One trade agreement with China and the USMCA boosted economic confidence across the region with expectations of higher international agriculture sales. The last time Creighton recorded economic confidence this high was when grain prices were double today’s values in 2013,” said Ernie Goss, PhD, who leads the survey for Creighton University.