How the Fed’s Most Important Message Became Enshrined in Dots
This is the story of the central bank’s “dot plot.”
What Happens If the Fed Makes a Policy Mistake?
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In early 2011, Federal Reserve officials were winding down the second round of their post-crisis bond-buying program known as quantitative easing and plotting an exit strategy from their unprecedented monetary stimulus.
At the same time, Janet Yellen, then-Fed vice chair, and her subcommittee on communications strategy were working on a way to convey to the public more information about the central bank's view of the future, at a time when many expected that a major shift in its policy stance was not too far off.