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The unemployment rate is expected to hit 7% or less by 2014.
Following the Fed's remarks today on the state of the economy, the Committee released a report [link opens a PDF] outlining economic forecasts for the next three years from board members and Federal Reserve bank presidents.
Overall, the Fed remains optimistic about our economy, which it currently describes as in a state of "moderate growth." The Fed's conservative estimates (excluding the three highest and three lowest projections) put GDP growth between 2.3% and 2.8% for 2013, heading as high as 3.7% by 2015, with a low estimate of 2.9% for 2015. The top of this so-called "central tendency" range for 2013 is slightly more pessimistic than the December estimate.
Source: Federal Reserve
The unemployment rate (currently 7.7%) is expected to hit 7% or less by 2014, according to the estimates released today, with longer-run equilibrium leveling at 5.2% to 6.0%. The Fed describes the longer-run projections as the rates "to which a policymaker expects the economy to converge over time -- maybe in five or six years -- in the absence of further shocks and under appropriate monetary policy."
Inflation rates remain relatively under control, and personal consumption expenditures (PCE) inflation should be 1.7% to 2.0% (the Fed's long-term target) in 2015.