Farm Economy Worries

Farm Economy Worries

Bob Larson
Bob Larson
From the Ag Information Network, I’m Bob Larson. Farm economists and Congressional lawmakers fear continued Federal Reserve interest rate hikes will further damage the economy.

The Federal Reserve is committed to continued rate hikes ‘til inflation is tamed, and that has farm economists like AFB’s Bernt Nelson concerned …

NELSON … “With the basis point adjustment, we really saw some strengthening happening with the U.S. dollar comparatively to other countries. So, as the dollar increases in value relative to other countries, that makes our products more expensive for these other countries to purchase. And that could result in things such as a slow(ing) in exports of some of our products, like meats.”

President Biden downplays chances of a full-blown recession, while Republicans, like Senate GOP Leader Mitch McConnell, play it up …

McCONNELL … “The Chairman of the Fed’s been quite clear. We’re going to have to raise rates. That runs the risk of having a recession, and that’ll be the price the American people have to pay.”

Despite the political finger pointing, AFB’s Nelson says consumers could still suffer…

NELSON … “When we start to see these recessions looming, or when we start to see an economic slowdown, we typically see consumers shift toward getting a better deal at the grocery store rather than necessarily purchasing a premium product.”

AFB reports skinless turkey breasts cost 112% more this September than last, while a dozen grade A large eggs are up 27%.

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