<p>If you read the recent speeches by members of the Federal Open Markets Committee, which sets the target Fed funds rate, a majority seems to favor cutting rates once they are convinced that inflation is definitively falling towards the 2% target.  Indeed, the Summary of Economic Projections published by the Fed in December 2023 contains a median forecast of 4.6% for Fed funds by year end 2024, a cut of 0.8%</p>
<p><a href="https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20231213.pdf" rel="nofollow noreferrer">https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20231213.pdf</a></p>

CC BY-SA 4.0
2024-01-24T07:36:19.097Z
Thanks. I'm not sure if I see 4.625% or 0.625% in the pdf?
HelloDarkWorld
CC BY-SA 4.0
2024-01-24T10:41:14.817Z
You are right , they rounded everything. I will edit
dm63
CC BY-SA 4.0
2024-01-24T06:45:12.367Z
2024-01-24T10:42:03.233Z
2024-01-24T10:42:03.233Z
dm63
<p>I know the Fed Funds rate has been increasing to lower the inflation rate, but what happens to the Feds Fund rate (will it increase, decrease, or stays constant?) after the inflation rate has been lowered to the projected level (e.g. 2.0%)?</p>

<inflation><fed-funds-rate>
If inflation rate drops, what happens to Feds Fund rate?
HelloDarkWorld
# If inflation rate drops, what happens to Feds Fund rate?

(Asked by: username_0 on 2024-01-24)

I know the Fed Funds rate has been increasing to lower the inflation rate, but what happens to the Feds Fund rate (will it increase, decrease, or stays constant?) after the inflation rate has been lowered to the projected level (e.g. 2.0%)?

**Tags:** inflation, fed-funds-rate


---

## 1 answers

### Answer by username_1 on 2024-01-24. Score: 1 | Accepted answer

If you read the recent speeches by members of the Federal Open Markets Committee, which sets the target Fed funds rate, a majority seems to favor cutting rates once they are convinced that inflation is definitively falling towards the 2% target. Indeed, the Summary of Economic Projections published by the Fed in December 2023 contains a median forecast of 4.6% for Fed funds by year end 2024, a cut of 0.8%

<https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20231213.pdf>

> **Comments:**
> **username_0**: Thanks. I'm not sure if I see 4.625% or 0.625% in the pdf?  
> **username_1**: You are right , they rounded everything. I will edit  

---

