Morgan Stanley says Federal Reserve will hold rates higher for longer, but then cut deeper

Morgan Stanley’s chief US economist Ellen Zentner spoke at a conference re her projections Federal Open Market Committee (FOMC):

  • “Make no mistake, they will be cutting rates this year”
  • But “they can be patient and they can take their time”

Morgan Stanley are forecasting the first in a series of rate cuts at the June meeting:

  • Fed will hold rates steady for longer than the market expects
  • but will then cut much more than expected
  • first 25bp cut in June

Then, 25bp cuts in:

  • September
  • November
  • December
  • and following on with a 25bp cut in every meeting through 2025

This article was written by Eamonn Sheridan at Source