Thus the staff is projecting how the economy would evolve if there were no change in the federal funds rate (which does not even always translate cleanly into no change in monetary policy). The rationale for this procedure is to separate the forecast process from the policy-making process, and therefore avoid appearing to prejudge the FOMC’s decisions.
And the ensuing experiences of the pandemic and the past few months did much to validate this approach. The bank runs and failures in 2023, however, were painful reminders that we cannot predict all of the stresses that will inevitably come with time and chance. We therefore must not grow complacent about the financial system's resilience. And building and maintaining that resilience requires collaboration.