Toby Madden - MACE 2012 Economic Outlook

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Toby Madden - MACE 2012 Economic Outlook

  1. 1. 2012 RegionalEconomic Outlook May 2012
  2. 2. DisclaimerThe views expressed here arethe presenters and notnecessarily those of the FederalReserve Bank of Minneapolis orthe Federal Reserve System. minneapolisfed.org
  3. 3. minneapolisfed.org
  4. 4. Agenda Ninth District Economy – Outlook • Surveys • Models – Sector Analysis • Agriculture • Manufacturing • Home building
  5. 5. District 9 Cleveland
  6. 6. Ninth District Economy: Growth in 2012• Business leaders remain optimistic• Employment up, modest unemployment rate reductions• Small wage and price increases• Agriculture sector strong & manufacturing upbeat• Slow home building sector
  7. 7. Business leaders remain optimistic100%90%80%70%60% Optimism50%40% Pessimism30%20%10% 0% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2012 2011
  8. 8. Employment expected to expand across the district6.05.04.0 20113.0 20122.01.00.0 MN MT ND SD WI UP Nonfarm employment forecast Percent change from a year earlier – 4th quarter
  9. 9. Business leaders expect increased employment at their companies RetailManufacturing 2011 Services Outlook DISTRICT 2012 Outlook Construction Agriculture 0 20 40 60 80 100 Diffusion index* *Index number above 50 indicates expansion. Index number below 50 indicates contraction.
  10. 10. Unemployment rates will decrease modestly 10 9 8 7 6 2011 5 4 2012 3 2 1 0 MN MT ND SD WI UP Unemployment rate – 4th quarter
  11. 11. Business leaders anticipate small wage increasesAbove 5%4% to 5% 2011 Outlook 20122% to 3% Outlook0% to 1% 0 10 20 30 40 50 60 Percent of respondents
  12. 12. Business leaders foresee some price increases ConstructionManufacturing Services 2011 Outlook DISTRICT 2012 Outlook Retail Agriculture 0 20 40 60 80 100 Diffusion index* *Index number above 50 indicates expansion. Index number below 50 indicates contraction.
  13. 13. Personal income growth expected to increase 7 6 5 4 3 2011 2 1 2012 0 -1 -2 -3 MN MT ND* SD WI Percent change from a year earlier – 4th quarter*Forecast for North Dakota has a wide 70 percent confidence interval.
  14. 14. Manufacturing survey reveals growth in 2011; faster growth expected in 2012Production level 2011 Profits Actual 2012 Employment Outlook Investment 0 20 40 60 80 100 Diffusion index* *Index number above 50 indicates expansion. Index number below 50 indicates contraction.
  15. 15. However, manufacturing respondents to business poll expect more modest growth in 2012 Sales 2011 Outlook Employment 2012 OutlookInvestment in plant and equipment 0 20 40 60 80 100 Diffusion index* *Index number above 50 indicates expansion. Index number below 50 indicates contraction.
  16. 16. Source: Lender Processing Services (LPS)
  17. 17. Delinquent Payment: 90+ PD, Foreclosure Source: Lender Processing Services (LPS)
  18. 18. Business leaders expect slower home building MT UP of MI 2011Greater MN OutlookWestern WI 2012MPLS MSA Outlook SD ND 0 20 40 60 80 100 Diffusion index* *Index number above 50 indicates expansion. Index number below 50 indicates contraction.
  19. 19. Ninth District Economy: Growth in 2012• Business leaders remain optimistic• Employment up, modest unemployment rate reductions• Small wage and price increases• Agriculture sector strong & manufacturing upbeat• Slow home building sector
  20. 20. Questions?

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