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The New York Fed DSGE Model Forecast—March 2026

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libertystreeteconomics.newyorkfed.orgThe New York Fed DSGE Model Forecast—March 2026newyorkfed.org

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This post presents an update of the economic forecasts generated by the Federal Reserve Bank of New York’s dynamic stochastic general equilibrium (DSGE) model. We describe very briefly our forecast and its change since December 2025 . To summarize, growth in 2026 is expected to be more robust, and inflation more persistent, than predicted in December. Stronger investment is the main driver for higher growth, while cost-push shocks, possibly capturing the effects of tariffs, are the key factors behind higher inflation. Projections for the short-run real natural rate of interest (r*) are the same as in December.

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