Each dot is one participant, anonymous and unweighted, and it shows where they think the rate should be, not where they promise it will go. It is published four times a year with the summary-of-economic-projections.
Markets trade the median dot. A shift of the median for the current year from three cuts to two is a hawkish surprise even if the statement is unchanged, and the two-year note usually moves within seconds of the 2pm release. The longer-run dot is the committee's estimate of the neutral-rate.
Example: in the previous SEP the 2026 median implied 3.375%. The new one implies 3.625%. That is one fewer 25 basis point cut, and fed-funds-futures for late 2026 sell off accordingly.
Related: fomc, summary-of-economic-projections, neutral-rate, fed-funds-futures, forward-guidance