SPENCER, Iowa — Ag bankers are showing signs of optimism as the rural economy shifts into positive territory for only the second time this year.

The December Rural Mainstreet Index (RMI), released by Creighton University, climbed to a reading of 50.1, pushing it just above “growth neutral”. This is a marked improvement from November’s reading of 44.0. The index, which ranges from 0 to 100 with 50.0 representing growth neutral, suggests that while challenges remain, the economic contraction may be easing.

“Negatives Getting Less Negative” Dr. Ernie Goss, who oversees the monthly survey of bank CEOs in a 10-state region, says the outlook for the coming year is brightening.

“The negatives are getting less negative,” Goss said. “I’d say they’re almost turning around being positive. We saw farmland prices growing and that’s a real good signal.”

Goss added that early indicators suggest 2026 will be a stronger year for the rural economy than 2025.

Iowa Lagging Behind While the region overall has hit growth neutral, Iowa is recovering at a slower pace than its neighbors. Iowa’s specific numbers rose month-over-month but remain below the growth neutral threshold.

Goss attributes this drag to the state’s heavy reliance on farm equipment manufacturing. He pointed to “backward linkages” affecting major producers like John Deere and metal manufacturers, which continue to face headwinds despite the broader recovery.

“Iowa was a bit… I won’t say troubled, it’s not troubled,” Goss explained. “It’s moving forward, just not as fast as the other nine states.”

Looking Ahead The report also noted a positive outlook for borrowing costs, with Goss projecting even lower interest rates heading into 2026.