Fed's Forecasting Dot Plot Shifts

Fed President Jim Bullard discusses the evolution of the Fed's dot plot forecasting strategy over time. During a period of low interest rates and low inflation, the dot plot indicated a steady state of affairs. However, with the pandemic altering the global macroeconomy, a shift in regime suggests a different approach, potentially leading to adjustments in the dot plot expectations. Bullard emphasizes the need for yield curve normalization while projecting higher yields in the future, reflecting a shift from the previous low-rate environment.