The Evolution of Disagreement in the Dot Plot

Foerster, Andrew

Journal Article

The Evolution of Disagreement in the Dot Plot

Abstract: The Summary of Economic Projections offers important insights into the views of Federal Open Market Committee participants. The summary’s “dot plot” charts each participant’s assessment of the appropriate path for monetary policy given their economic outlook. A new index measuring the level of disagreement indicated by the dots shows that disagreement fell during the 2010s expansion, was nearly nonexistent early in the pandemic, and has been increasing recently. Policy disagreement is correlated with disagreement about future inflation, but factors unrelated to disagreement about the outlook also play a large role.

Keywords: Federal Open Market Committee (FOMC); pandemic; covid19; inflation; disagreement;