Fed median projection for end 2025 Federal funds rate 3.6% vs. 3.9% prior

The Federal Reserve released the economic projections of Federal Reserve Board members and Federal Reserve Bank presidents under their individual assessments of projected appropriate monetary policy, sometimes referred to as the “dot plot,” which shows that the group’s median forecast now calls for a Fed funds rate of 3.6% vs. 3.9% prior projection from June. The “central tendency” of the group, which excludes the three highest and three lowest projections for each variable in each year, shows the projected Federal funds rate for the end of 2025 at 3.6%-4.1% vs. 3.9%-4.4% in June. The group’s median forecast calls for a Fed funds rate of 3.4% at the end of 2026, donw from a prior view of 3.6% at the end of next year. The group’s median forecast calls for a Fed funds rate of 3.1% at the end of 2027, down from a prior view of 3.4% at the end of that year.