Over 1/3 of rural bankers in 10 mid-America states report recession conditions, but overall economic confidence rising

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A Creighton University survey of rural Midwestern bankers in October found a cautiously optimistic outlook, with the overall Rural Mainstreet Index climbing slightly above growth-neutral, its highest reading since January. The index ranges between 0 and 100 with a reading of 50 representing growth-neutral. In September the overall index was 46.9, but this month's was 53.2.

The index is a survey of bankers in about 200 rural communities with an average population of 1,300 in 10 states where agriculture and energy are critical to the economy: Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming.

"Recent improvements in agriculture commodity prices, federal farm support, and the Federal Reserve’s record low interest rates have underpinned the Rural Mainstreet Economy. Still, more than one-third, or 35.5%, of bank CEOs reported their local economies were experiencing recessionary economic conditions," reports Creighton economist Ernie Goss, who does the survey.

One banker said that politicized misinformation about a coronavirus vaccine has led many locals to say they won't get the vaccine when it becomes available. Failure to achieve a high vaccine rate, and therefore control the spread of the coronavirus, will hurt economic recovery, the banker told Goss.

Other findings of interest in this month's survey:

• Overall index advanced for a sixth straight month to its highest level since January of this year.
• More than eight of 10 bank CEOs identified restaurants/bars as experiencing the greatest negative impact from covid-19.
• Only 3% of bankers named farmers as experiencing the greatest negative covid-19 impacts.
• For only the third time in the past 82 months, the farmland price index advanced above growth neutral.
• Bank CEOs estimated that farm equipment sales will fall by an additional 3.1% over the next 12 months.
• More than one-third, or 35.5%, of bank CEOs reported that their local economies were experiencing recessionary economic conditions.