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At today’s meeting of the Federal Open Market Committee, the U.S. central bank raised interest rates by 75 basis points for a third straight meeting. That took the Fed’s short-term benchmark rate to a range of 3% to 3.25%.

This move was widely expected with the CME FedWatch Tool giving odds of 84% yesterday on a 75 basis point increase.

What the market hadn’t expected was how negative the Fed’s projections in its Dot Plot would be.

The Fed said the Fed funds rate would stand at 4.4% at the end of 2022. That’s more than 100 basis points above the September rate. Which means 50 basis point increases at both the November and December meetings. In its June projections, the Fed was looking for 3.4% by the end of 2022.

In 2023, the Fed said today, it expects benchmark interest rates of 4.6%. That’s up from 3.8% in the June projections.

Inflation would remain higher for longer according to the Dot Plot with headline PCE at 5.4% at the end of 2022. In June the bank was looking for 5.2% at the end of 2022. Inflation will respond to the Fed’s interest rate increases by falling to 2.8% by the end of 2023. (June projection was for 2.6%.) Inflation would still be above the Fed’s target 2% rate at 2.3% at the end of 2024.

And as you might expect from this economic growth would be lower, according to Dot Plot projections. Real GDP growth for 2022 would be just 0.2%, down from a projected 1.7% in June. In 2023 growth would rebound to 1.2%. Significantly below the 1.7% projected in June.

To sum up: Higher interest rates (with more rate increases) for longer. And very low economic growth but no recession.

These are just projections, mind you. And I’d guess that the Fed isn’t interested in causing a recession by predicting one.