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BANKERS: RURAL MAINSTREET ECONOMY MOVES INTO NEGATIVE GROWTH TERRITORY
Source: Creighton University news release

The Rural Mainstreet economy moved into negative growth territory according to the February survey of bank CEOs in a 10-state area.

Overall: The Rural Mainstreet Index (RMI), which ranges between 0 and 100, with 50.0 representing growth neutral, fell to 48.4 from 50.8 in January and December's much healthier to 56.1.

"The overall index for the Rural Mainstreet Economy indicates that areas of the nation highly dependent on agriculture and energy are losing economic steam. Despite year-over-year declines in agriculture commodity prices, bankers expect even more weakness for 2014.

Almost nine of 10, or 89.5 percent, of the bank CEOs consider lower agriculture commodity prices as the biggest threat to the 2014 economy. These softer prices have had, and will likely continue to have, negative impacts on the Rural Mainstreet economy," said Ernie Goss, the Jack A. MacAllister Chair in Regional Economics at Creighton University Heider College of Business.

At least a portion of the weaker numbers for February can be attributed to unusually harsh weather. Pete Haddeland, CEO of the First National Bank in Mahnomen, Minn., said, "We have seen a slowdown due to the cold winter and high heating costs."

Farming and ranching: The farmland and ranchland-price index for February decreased to 41.7, its lowest level since September 2009, and down from last month's 43.8. "This is the third straight month that the farmland and ranchland-price index has moved below growth neutral," said Goss.

Next month's survey results will be released on the third Thursday of the month, March 20.


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