Morgan Stanley Fixed-US Economics Global Macro Strategy Correction FOMC React...-106260699

MFebruary1,202412:55PMGMTMorganStanley&Co.LLCIdeaUSEconomics&GlobalMacroStrategyNorthEllenZentner+1212296-4882America+1212761-1445ChiefUSEconomist+1212761-4630Correction:FOMCReaction:Ellen.Zentner@morganstanley.com+1212761-8573MarchIsOut,B/SDiscussionsto+1212761-0857BeginGuneetDhingra,CFA+1212761-1837+1212761-5287AccordingtoChairPowell,itisn'tlikelytheCommitteewouldbeStrategist+1212761-2647confidenttocutbyMarch.TheFedwillbecuttingratesthisGuneet.Dhingra@morganstanley.comyear,butisinnohurry.WecontinuetocallforaJunestart.Our+8136836-5466strategistsstaylongdurationvia5yUST,andneutralagencySamDCoffinMBS.+1212761-6051Economist+1212761-3529KeyTakeawaysSam.Coffin@morganstanley.com+1212761-2779•Ratesdecision:TheFOMCheldthepolicyrateinarangeof5.25-DiegoAnzoategui5.50%,whereithasremainedsinceJuly2023.Year-over-yeargrowthincorePCEinflationwas2.9%inDecember,andsotheCommitteeEconomisthasseen"goodprogress"towarditsgoals,butinflationisstillDiego.Anzoategui@morganstanley.com"elevated".SarahAWolfe•Outlook:"Almosteveryone"favorscuttingratesthisyear,suggestingtherehasbeennochangeinviewssincetheDecemberSEP.ButtheEconomistCommitteeisinnohurrytogetstartedandChairPowellwasSarah.Wolfe@morganstanley.comconfidentenoughtoruleoutMarch.WecontinuetoexpectthefirstratecutinJune.PowellnotedtheFedwillbeginin-depthdiscussionsMatthewHornbacho...