Monetary Rules Dashboard

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Current monetary-rule benchmarks

Monetary rules are simple formulas that say where the Federal Reserve’s interest rate should be, given inflation and the state of the economy. This dashboard compares those benchmarks with where the rate actually is.

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A benchmark above the Federal Reserve’s target range implies a tighter policy stance than today’s. These rules are descriptive benchmarks—not forecasts, automatic recommendations, or mechanical instructions.

Benchmark range—

Median benchmark—

Current effective federal funds rate—

What do the rules say now?

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Actual effective federal funds rate = the overnight rate that prevails Federal Reserve target range = the official policy range Rule benchmarks = rates generated by the formulas

Taylor rules Nominal GDP rules

Descriptive takeaway: Loading the current comparison.

Why did the benchmarks change?

The bars show how each input raised or lowered the selected benchmark since the preceding snapshot. Changes are shown in basis points; 100 basis points equal 1 percentage point.

Rule

Raised the benchmark Lowered the benchmark

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How does that compare with actual policy over time?

Compare representative rule benchmarks with the actual effective federal funds rate. The default view focuses on the most recent five years; the full history remains one click away.

Series

Period

Export

Move across the chart to inspect a quarterly observation.

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What does each model say?

The gap measures percentage points above the current actual effective federal funds rate. Detailed values are shown to two decimal places.

Family	Specification	Neutral-rate estimate	Benchmark rate	Change From Last FOMC	Gap vs. actual rate	Status

Why do the rules differ?

Every rule combines economic conditions in a slightly different way. Those choices create a range of benchmarks rather than one definitive answer.

Different inflation views

Some Taylor rules use current inflation; others use a forecast of where inflation is heading.

Different degrees of smoothing

Some rules react immediately, while others place weight on the previous policy rate and therefore move more gradually.

Different economic signals

Taylor rules emphasize inflation and labor-market conditions. Nominal GDP rules emphasize total spending growth or its path.

Technical methodology, equations, symbols, and data details

Inputs and abbreviations

i_t-1: previous actual effective federal funds rate.
r*: neutral real interest-rate estimate. SEP is the Federal Reserve’s Summary of Economic Projections; HLW is the New York Fed’s Holston-Laubach-Williams model.
π and π*: personal consumption expenditures (PCE) inflation and its target; π^e is the Survey of Professional Forecasters (SPF) forecast.
u gap: the labor-market gap used in the source workbook.
g_N and g*: nominal gross domestic product (NGDP) growth and its target; N gap is the nominal-spending gap.

Dates and neutral-rate alternatives

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Featured rows use the Federal Reserve’s own longer-run neutral-rate estimate from the Summary of Economic Projections. Alternate rows substitute the New York Fed model estimate. Historical values are organized by quarterly observation date; immutable releases preserve their separate as-of versions.

Rule	Neutral-rate estimate	Equation
Original Taylor	Fed projection (SEP)	`i = r_SEP + π + 1.5(π − π*) + 0.5(u gap)`
Original Taylor	NY Fed model (HLW)	`i = r_HLW + π + 1.5(π − π*) + 0.5(u gap)`
Forward-looking Taylor	Fed projection (SEP)	`i = r_SEP + π + 1.5(π^e − π*) + 0.5(u gap)`
Forward-looking Taylor	NY Fed model (HLW)	`i = r_HLW + π + 1.5(π^e − π*) + 0.5(u gap)`
Smoothed Taylor	Fed projection (SEP)	`i = 0.5i_t-1 + 0.5(Original Taylor, SEP)`
Smoothed Taylor	NY Fed model (HLW)	`i = 0.5i_t-1 + 0.5(Original Taylor, HLW)`
Modified Taylor	Fed projection (SEP)	`i = 0.5i_t-1 + 0.5(Forward-looking Taylor, SEP)`
Modified Taylor	NY Fed model (HLW)	`i = 0.5i_t-1 + 0.5(Forward-looking Taylor, HLW)`
Nominal GDP growth	Fed projection (SEP)	`i = 0.5i_t-1 + 0.5[(2 + r_SEP) + (g_N − g)]`
Nominal GDP growth	NY Fed model (HLW)	`i = 0.5i_t-1 + 0.5[(2 + r_HLW) + (g_N − g)]`
Nominal GDP level	Fed projection (SEP)	`i = 0.5i_t-1 + 0.5[(2 + r*_SEP) + N gap]`
Nominal GDP level	NY Fed model (HLW)	`i = 0.5i_t-1 + 0.5[(2 + r*_HLW) + N gap]`

Related reports

Primary data sources

Federal Reserve Bank of Atlanta Taylor Rule Utility
Federal Reserve Bank of New York actual effective federal funds rate
Bureau of Economic Analysis nominal gross domestic product
Monetary Neutrality Report nominal-spending gap