Morgan Stanley cuts 2019 rate hike forecast, says the US economic growth moving through a trough
|Morgan Stanley is out with its forecast for the Federal Reserve rate hikes during 2019. The investment bank says it now expects only one rate hike from the Fed during December 2019 against previously forecasted two (June and December).
The report further elaborates that the US central bank’s rate-hike trajectory will remain on hold after December 2019 through middle of 2020 until inflation picks up. It should also be noted that the investment bank expects three rate hikes next year, namely in June, September and December.
On the economic growth, the bank says that the US economy is moving through a trough at present with first quarter (Q1) 2019 growth likely around +0.5% followed by 2.3% increase in Q2. For the second half of 2019, the bank predicts 2.1% growth.
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