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A Federal Reserve report revealed the economic outlook of the Federal Open Market Committee (FOMC) members and regional Fed heads, showing that they kept their projections for rate cuts this year unchanged.
Policymakers lowered their US economic growth forecasts for 2025, while raising their inflation expectations, the report released on March 19 showed.
Projections suggest two additional rate cuts of 25 basis points each this year, aligning with the policymakers’ estimates issued in December 2024.
These estimates reflect policymakers' expectations for changes in key economic indicators between Q4 2025 and Q4 2024.
Average Forecasts of Fed Members for Key US Economic Indicators (%)
|
Indicator |
Forecast Date |
2025 |
2026 |
2027 |
|---|---|---|---|---|
|
Real GDP |
March |
1.7 |
1.8 |
1.8 |
|
Unemployment Rate |
December |
2.1 |
2.0 |
1.9 |
|
March |
4.4 |
4.3 |
4.3 |
|
|
PCE Price Index (Inflation) |
December |
4.3 |
4.3 |
4.3 |
|
March |
2.7 |
2.2 |
2.0 |
|
|
Core PCE Price Index |
December |
2.5 |
2.1 |
2.0 |
|
March |
2.8 |
2.2 |
2.0 |
|
|
December |
2.5 |
2.2 |
2.0 |
|
|
Interest Rate |
March |
3.9 |
3.4 |
3.1 |
|
December |
3.9 |
3.4 |
3.1 |
These estimates reflect policymakers' expectations for changes in key economic indicators between Q4 2025 and Q4 2024.
The latest data showed that the US unemployment rate reached 4.1% in February, while the Personal Consumption Expenditures (PCE) Price Index stood at 2.5% in January, with the core PCE index recording 2.6% in the same month.
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