Slow growth was observed in Midwest rural economies, but political uncertainty, low grain prices and cattle losses resulting from the unexpected winter storm prevented substantial improvement.
The monthly survey of community bank presidents and CEOs in the 10-state area shows growth for the Rural Mainstreet economy remains positive. The October Rural Mainstreet Index (RMI) improved 1.9 percent to 54.3%, signifying slight economic growth.
Improvements were noted for hiring, up 2.9 to 56.1 on the index and an optimistic reaction to the government shutdown. Of the bankers and CEOs surveyed, only 25.9 percent saw a negative impact from the furlough while 74.1 percent saw little or no impact.
Many categories influencing the rural economy are declining, however many remain above 50, pointing to continued growth.
Lower grain prices are affecting land values and farm equipment sales. The farmland-price index has fallen lower in all but one of the past 11 months. The index, which fell 3.1 lower on the index to 50.9, is weakened by lower agriculture commodity prices and poor weather conditions.
Farmland cash rent prices are also forecasted to increase over the next year, but at a much lower increase compared to six months earlier. Farm equipment sales fell from 48.3 to 44.6 on the index, showing continued decline.