The Federal Reserve released its latest macroeconomic projections along with its monetary policy announcement. Projections turned out to be more optimistic than those published in June.
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U.S. GDP will shrink 3.7% in 2020 (vs June projection: -6.5%)
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U.S. unemployment rate to be significantly lower at the end of the year (similarly to 2021, and 2022)
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Higher inflation in both 2020 and 2021. Still, PCE and core PCE target should not be achieved until 2023.
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The Fed sees rates close to zero though 2023
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Long-term rates median remains at 2.5%
Solid macroeconomic projections, particularly for 2023. Nevertheless, most Fed members do not see any changes for higher interest rates. That is crucial for stock markets, gold and other risk assets - rates will remain near zero despite better economic outlook. Source: Fed
