Fed median projections for 2025 GDP rises to 1.6% from 1.4% in June

FOMC’s Summary of Economic Projections, SOEP, now sees 2025 Median estimate GDP at 1.6% vs. 1.4% prior, 2026 GDP at 1.8% vs. 1.6% prior, and 2027 GDP at 1.9% vs. 1.8% prior. FOMC’s projections for unemployment for 2025 remains at 4.5%, but for 2026 SOEP sees unemployment of 4.4% vs. 4.5% prior and 2026 unemployment at 4.3% vs. 4.4% prior. For Core PCE inflation, FOMC maintains its 2025 view of 3.1%, raises its 2026 view to 2.6% from 2.4%, and keeps its 2027 view at 2.1%. Over the “Longer Run”, SOEP projections for Fed funds rate remains at 3.0%, GDP remains at 1.8%, Unemployment remains at 4.2% and overall PCE inflation remains at 2.0%.