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For a third straight month, the overall Rural Mainstreet Index (RMI) sank below growth neutral. The region’s overall reading for November fell to 40.4 from 44.4 in October and 49.5 in September. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.

“This is the weakest recorded reading in more than three years, or since June 2020, shortly after the beginning of the pandemic, and points to weaker farm and non-farm economies,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University.

Farm equipment sales: The farm equipment-sales index for November increased slightly to a weak 49.5 from October’s 48.0. “This is the fifth time the past 6 months that the index has fallen below growth neutral. Higher borrowing costs are having a negative impact on the purchases of farm equipment,” said Goss.

Farming and ranching land prices: The region’s farmland price index climbed to 66.7 from October’s 55.6. “Creighton’s survey continues to point to solid, but slowing, growth in farmland prices as farm commodity prices weakened,” said Goss.

Banking: “Higher short-term interest rates produced by Federal Reserve rate hikes over the past year continue to pose a significant threat to community banks by expanding the costs of customer deposits while the rates on bank loans have not risen as significantly over the same time period,” said Goss.

Confidence: Higher interest rates, deposit outflows and a slowing farm economy over the past several months continued to constrain the business confidence index to a record low 21.2 from 24.1 in October. “This month’s reading is the most negative outlook recorded since Creighton began the monthly survey in January 2006,” said Goss.

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