Midwest, Plains Bankers Optimistic On Economy
OMAHA, Neb. (AP) — The outlook for rural areas of 10 Midwest and Plains states remains positive thanks to the improving economy, according to a new survey of bankers released Thursday.
The overall Rural Mainstreet economic index declined to 55.3 in February from January’s 59.3, but the index remains in positive territory above 50, which suggests the economy will expand over the next six months. A score below 50 would suggest the economy will contract.
Creighton University economics professor Ernie Goss, who oversees the survey, said the region’s economy benefited from the strengthening global economy, a cheap dollar and alternative energy production.
Bankers in rural parts of Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming are surveyed.
The farmland price index remained exceptionally high at 75.9 in February. That’s slightly higher than January’s 75.4.
The farm equipment sales index declined to 63.5 in February from January’s 74.6 but remained high. Goss said bankers throughout the region reported strong agricultural equipment sales.
Goss said farmers appear to have reduced their borrowing because of strong cash flow. The loan volume index remained at a weak level but rose to 39 in February from January’s 33.9.
Cameron Mathis, president of Tilden Bank in Creighton, Neb., said he expects farm income to slow in 2011 because costs are higher.
The confidence index jumped to 70.9 in February from January’s already-strong 63.4.
The jobs index remained in positive territory at 52.5 in February, which was equal to January’s figure.
But the home sales index remained weak at 44 in February, down slightly from January’s 44.1.
“Home sales have been on the decline since the tax credit for first-time home buyers ended last April,” Goss said.
The checking deposit index grew to 67.8 in February from January’s 66.2. The index for savings accounts and certificates of deposit slipped to 50.8 in February from January’s 52.5.
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