Minneapolis Fed forecasts moderate growth in state in 2014
MINNEAPOLIS — The 2014 economic outlook from the Federal Reserve Bank of Minneapolis calls for moderate growth in the Minnesota economy. Based on the Minneapolis Fed’s statistical model, employment in Minnesota is expected to grow by 1.2 percent, while the unemployment rate is predicted to drop from 4.6 percent in November 2013 to 4.3 percent in the fourth quarter of 2014. Growth in personal income is anticipated to be 5 percent.
“The Minnesota economy continued on its upward trend in 2013, which will continue into 2014, but the pace of growth may slow slightly,” said Toby Madden, regional economist at the Minneapolis Fed, in a news release.
In addition to the forecasting model, the Minnesota outlook includes information from the annual fedgazette business outlook poll of 321 district businesses and the annual manufacturing survey of 485 district manufacturers. The poll and survey were mailed out in early November and returned by Dec. 10. The Ninth District includes Minnesota, Montana, North and South Dakota, northwestern Wisconsin and the Upper Peninsula of Michigan.
“Both the statistical model and surveys point to a moderate economic performance in 2014,” Madden said. “Businesses expect growth for their own operations and the state economy.”
The survey of business leaders indicates that businesses expect more sales and investment in 2014 and expect to raise prices. Respondents to the manufacturing survey are more bullish about their own operations and expect productivity and profits to rise.
In regard to the state economy, both the surveys and the statistical model see increases in housing construction. They also expect increased business investment and higher prices.
More details on the 2014 economic forecast for Minnesota and the Ninth District can be found in the January issue of the fedgazette, the Minneapolis Fed’s quarterly newspaper, as well as at minneapolisfed.org.
The Federal Reserve Bank of Minneapolis is one of the 12 Federal Reserve banks. Together with its branch in Helena, Mont., the Minneapolis Fed serves the Ninth Federal Reserve District, which includes Minnesota, Montana, North and South Dakota, 26 counties in northwestern Wisconsin and the Upper Peninsula of Michigan.