Analysts at Morgan Stanley expect the first rate cut from the US Federal Reserve at the June FOMC meeting.
- Followed by a cut in the meetings in September, November and December.
- 25bp each time
- “Despite a higher long-run rate, the long-run growth projection was unchanged at 1.8%, indicating the Fed sees recent supply-side factors driving growth higher as temporary.”
Morgan Stanley also noted that
- “While large caps have exhibited declining rate sensitivity over the past few months, small caps’ correlation with rates remains meaningfully negative, suggesting to us that they are more at risk than large-caps if UST yields move higher”
This article was written by Eamonn Sheridan at www.forexlive.com.
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