Debt-heavy farm operations will continue to feel the burden of borrowing costs as the Federal Reserve said it would leave interest rates holding at 4.25% to 4.5% and persist in its quest to reduce inflation to 2%.
“For the agricultural industry, farmers who rely on financing to fund their enterprises will continue to face high borrowing costs,” said Ryan Loy, Extension economist for the University of Arkansas System Division of Agriculture. “The steady rate decision means financial strain may persist for producers with debt-heavy operations, and financial relief may take longer than expected when the Federal Open Market Committee made its first rate cut in September 2024.”
Loy said that consumer spending and labor market conditions have been the main drivers of the economic expansion.
PHOTO: Federal reserve building, the headquarters of Federal reserve bank. Washington DC, USA. (Adobe Stock │ 241944992 – tanarch)
