---
id: "claim-fed-funds-rate-target"
type: "claim"
source_timestamps: ["00:03:41", "00:03:48"]
tags: ["federal-reserve", "interest-rates", "predictions"]
related: ["claim-fed-rate-cuts"]
confidence: "high"
testable: true
speakers: ["Jared Dillian"]
sources: ["dillian"]
sourceVaultSlug: "jared-dillian-macro-trading-wealth-2026Jun25"
originDay: 6
---
# Fed Funds rate will drop to 2.5% - 3%

## Claim

The [[entity-federal-reserve]] will aggressively cut the Fed Funds rate, bringing it down to a target range of **2.5% to 3.0%** by Q1 of the following year.

## Reasoning

This represents a significant reduction from elevated rates maintained to fight inflation, signaling a shift in Fed policy toward stimulating a weakening economy. The thesis depends on continued labor weakening — see [[claim-labor-market-weakening]] — and aligns with [[claim-fed-rate-cuts]].

## Confidence & Testability

- **Confidence**: High
- **Testable**: Yes — directly observable via FOMC announcements
- **Enrichment caveat**: Forecast certainty is inherently low. The Fed can delay or moderate cuts if inflation re-accelerates or growth remains resilient.

## Related

- [[claim-fed-rate-cuts]]
- [[claim-labor-market-weakening]]
- [[entity-federal-reserve]]