WHITHER RATES?

The Fed is set to leave its benchmark rate—which can influence everything from mortgages to credit cards to home equity lines of credit— unchanged in a range of 2.25 percent to 2.5 percent. But what about the rest of the year?

For that answer, analysts will be watching the so-called “dot plot.” This is an illustration in which each of the 17 members of the Fed’s interest rate committee provides his or her anonymous forecast of where their key policy rate will go. On Wednesday, the dots will show where the officials expect the rate to be at the end of 2019 and after each of the next two years. The median dot—where half are above, half below—is closely watched for the Fed’s view of where its key rate might be headed.

It isn’t always correct. In December 2017, for example, the Fed’s policymakers predicted four rate increases in 2018. That proved true. In September 2018, though, the Fed projected three rate hikes in 2019, only to reduce that prediction in December to two. And on Wednesday, many economists say they think the new dot plot will forecast just one rate increase this year.

Even that may overstate what the Fed will end up doing. Traders in futures markets have put the probability of a rate hike at any time this year at zero percent, according to data tracked by the CME Group. In fact, the CME index projects a one-in-four chance that the Fed will go so far as to cut rates by year’s end to help fight an expected economic slowdown.