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Glossary/Monetary Policy & Central Banking/Dot Plot
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Monetary Policy & Central Banking
2 min readUpdated Apr 2, 2026

Dot Plot

SEP dot plotFOMC dot plotSummary of Economic Projections

A chart published quarterly by the FOMC showing each member's anonymous projection for the appropriate fed funds rate at year-end for the next three years and over the long run.

Current Macro RegimeSTAGFLATION→ DEEPENING

The macro regime is unambiguously STAGFLATION DEEPENING. The three-pillar structure remains intact and strengthening: (1) Energy-driven inflation shock — WTI at $104-111, +40% in 1M, flowing through PPI (+0.7% 3M, accelerating) into a CPI/PCE pipeline that has not yet absorbed the full pass-through,…

Analysis from Apr 3, 2026

What Is the Dot Plot?

The dot plot is part of the Federal Reserve's Summary of Economic Projections (SEP), released after FOMC meetings in March, June, September, and December. Each dot represents one FOMC member's view of where the fed funds rate should be at year-end for the current year, the next two years, and "over the longer run."

How to Read It

The dots are anonymous — you cannot see which member placed which dot. What matters most is:

  • The median dot: The middle value in each year's distribution — the market's primary reference for the Fed's intended rate path
  • Dispersion: Wide scatter indicates internal disagreement; tight clustering signals consensus
  • Shifts between meetings: Dots moving higher ("hawkish shift") or lower ("dovish shift") relative to the prior SEP drive significant market moves

The Long-Run Dot

The "longer-run" dot represents each member's estimate of the neutral rate — the rate that neither stimulates nor restricts the economy. This has drifted up from ~2.5% post-GFC to ~3% in the mid-2020s, with significant implications for where rates eventually settle.

Limitations

The dot plot has been widely criticised:

  1. Members are not bound by their dots — they represent intentions, not commitments
  2. Economic conditions can change dramatically between SEP releases
  3. The dots have frequently been wrong, notably in 2021 when they showed no rate hikes through 2024 even as inflation was accelerating

Despite these limitations, markets react strongly to dot plot shifts because there are few better publicly available signals of the Fed's collective thinking.

Frequently Asked Questions

▶How often is the dot plot updated, and when is it released?
The dot plot is released four times per year as part of the Federal Reserve's Summary of Economic Projections, following FOMC meetings in March, June, September, and December. It is published simultaneously with the FOMC policy statement at 2:00 PM Eastern Time on the final day of the meeting, with the Fed Chair's press conference following at 2:30 PM, where journalists frequently probe the committee's dot-plot rationale.
▶Can you tell which Fed member placed which dot on the dot plot?
No — the dots are deliberately anonymous, so it is impossible to attribute any specific dot to a named FOMC participant. While Fed watchers sometimes attempt to infer individual placements from public speeches and known policy leanings, these are educated guesses rather than confirmed attributions. This anonymity is intentional, designed to encourage honest projections without political pressure, but it also limits the market's ability to weight dots by the historical accuracy of individual forecasters.
▶Why does the dot plot so frequently differ from where rates actually end up?
The dot plot reflects each participant's best forecast conditioned on the economic data available at the time of the meeting, so it is inherently vulnerable to data surprises — unexpected inflation, employment shocks, or financial stability events can obsolete the projections within weeks. The 2021 episode is the starkest example, where flat-rate dots proved wildly inconsistent with an inflation surge that was already evident in the data. Traders should treat the dot plot as a snapshot of the committee's current reaction function, not a reliable point forecast, and always compare it against market-derived instruments like fed funds futures and overnight index swaps for a fuller picture.
Related Terms
Fed Funds RateFOMCForward Guidance

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