Morgan Stanley Predicts Fed and ECB Likely to Cut Interest Rates in September
The ongoing speculation about the Federal Reserve’s timeline for interest rate cuts may soon find resolution, with strong indicators pointing towards September. Among the voices chiming in is Morgan Stanley, a prominent player in the financial sector.
Morgan Stanley anticipates that both the US Federal Reserve (Fed) and the European Central Bank (ECB) could enact interest rate reductions by September. Andrew Sheets, a senior strategist at Morgan Stanley, shared insights with CNBC, citing recent economic data indicating a decline in inflation as the basis for their forecast.
Despite the Fed’s current stance that US inflation remains too high to warrant rate cuts, Sheets remains optimistic that the inflation rate will sufficiently decrease by September. This, he believes, will prompt both central banks to initiate rate cuts cautiously.
“While central banks refrain from definitive statements ahead of time to avoid appearing complacent about inflation risks, our projections suggest that forthcoming data until September will likely show sustained moderate inflation,” noted Sheets.
Morgan Stanley’s forecast has triggered discussions across various markets, including cryptocurrencies like Bitcoin and altcoins, with experts speculating that simultaneous rate cuts by the Fed and ECB could bolster the current bullish trend.
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