Creighton University’s monthly Rural Mainstreet Survey of bankers in rural portions of Nebraska, South Dakota, and 8 other high plains and Rocky Mountain states indicates the regional economy is starting to shrink.
The survey’s overall index has 50 as its neutral point with numbers over 50 showing a growing economy and numbers under 50 a shrinking economy. The June index came in at 49.8, dropping under neutral for the first time in nearly 2 years.
Nebraska’s economy is continuing to do better than the other states in the survey, still growing but at an increasingly smaller pace. The state’s overall index dropped 2 point this month, but was till in the positive at 54.1.
The bankers are pessimistic about the short-term future and think things will get a lot worse before they get better. Nearly 93% rated the chances of a recession in the U-S over the next year at better than 50%.
They cited the negative impact on rural areas of high gasoline prices, skyrocketing ag input prices, and rising interest rates.
In the same vein, the Business Confidence Index – how they see things in 6 months – dropped to 33.9, giving the lowest back-to-back monthly readings since the start of the pandemic in April and May of 2020.