The Federal Reserve Bank of Minneapolis
announced the national and regional economic outlook for 2004 during a
media briefing today at the Minneapolis Fed. This forecast includes information
from the Minneapolis Fed’s statistical models and results from the
annual business conditions outlook poll. The following information will
be available in detail in the January 2004
issue of the fedgazette.
National Economic Forecast*
- Moderate growth is projected for the national economy in 2004.
- The unemployment rate will likely decrease slightly.
- Modest increases in the U.S. Consumer Price Index are anticipated
- The district economy is expected to expand modestly in 2004, according
to a poll of business leaders and the Minneapolis Fed’s regional
- Gains in employment and personal income are predicted across the
district, while unemployment rates are not expected to change significantly.
- Housing units authorized are forecast to increase slowly in most
- Wages and prices are expected to increase modestly.
- District manufacturers are optimistic for 2004.
- Agricultural producers had a strong 2003 and are cautiously optimistic
District business leaders appear to have turned the pessimism corner,
exhibiting their most optimistic views on the economy and the prospects
for their own firms since 1999. Most respondents to the November business
outlook poll expect the national and district economies to grow 3 percent
or more in 2004. Most predict modest inflation growth; however, within
their own communities they envision increases in employment, investment
and consumer spending, with only a slight decrease in housing starts.
For their own companies, respondents anticipate increasing sales, employment,
capital investment and prices. Nonetheless, tight state and local government
budgets are expected to have a somewhat negative effect on their businesses.
*Forecast from national and regional models developed by researchers at
the Minneapolis Fed. The models use a statistical procedure called Bayesian
** Key findings from a November 2003 poll of 335 business leaders in the
Ninth Federal Reserve District.