The Creighton University Rural Mainstreet Index (RMI) climbed in February and remained above growth neutral for the 15th straight month, according to the monthly survey of bank CEOs in rural areas of a 10-state region — Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming — dependent on agriculture and/or energy.

The region’s overall reading for February rose to 61.5 from January’s 61.1. The index ranges between 0 and 100 with a reading of 50.0 representing growth neutral.

“Strong grain prices, the Federal Reserve’s record-low short-term interest rates, and growing agricultural exports have underpinned the Rural Mainstreet Economy,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business. The region’s farmland price index decreased to a very strong 78.8 from January’s 88.5 and December’s record high of 90.0. February’s reading represented the 17th straight month the index has moved above growth neutral.

The February farm equipment-sales index slipped to a very healthy 72.0 from 72.4 in January. This is the 15th straight month that the index has advanced above growth neutral. Readings over the past several months are the strongest string of monthly readings recorded since Spring 2011.

Bankers were asked to project corn and soybean prices out six months. On average, banks expect corn prices per bushel to fall by 2.6% and soybean prices per bushel to drop by 2.3%.

The February loan volume index increased to 40.4 from January’s weaker 28.8. While February farm loans are normally low, this reading was below expected February readings. The checking-deposit index climbed to 80.8 from January’s 76.9, while the index for certificates of deposit and other savings instruments sank to 34.6 from 42.3 in January.

On average, bank CEOs expect the Federal Reserve to raise short-term interest rates by one percentage point which is up from 0.70% (70 basis points) recorded last month. Approximately one in five bankers project more than four rate hikes of one-quarter percentage point in 2022.

The new hiring index expanded to 61.5 from 61.1 in January. Labor shortages continue to be a significant issue constraining growth for Rural Mainstreet businesses. As a result of recent strong Rural Mainstreet job gains, the U.S. Bureau of Labor Statistics data indicate that over the last 12 months, the region has experienced a healthy 4.2% gain in nonfarm employment (non-seasonally adjusted).

The survey represents an early snapshot of the economy of rural agriculturally and energy-dependent portions of the nation. RMI is a unique index covering the 10 states, focusing on approximately 200 rural communities with an average population of 1,300. It gives the most current real-time analysis of the rural economy.

Click here for more Industry News.