So starting with our last meeting, the expanded SEP now contains information about policymakers’ assumed path for monetary policy, along with the projections for growth, unemployment, and inflation. It is important to keep in mind that the Fed’s SEP projections differ from those of private-sector forecasters. Private-sector forecasters explicitly or implicitly try to predict what the Fed’s next move will be.
In the SEP, each policymaker assumes a path for monetary policy that – based on current economic conditions – he or she believes will deliver the best outcomes for the economy. Providing policy projections in the SEP helps the public to interpret the economic forecasts included in the SEP. For example, FOMC participants might have considerably different growth forecasts.