Morgan Stanley Predicts Low Likelihood of Fed Rate Cut Amid Inflation Concerns

According to BlockBeats, Morgan Stanley analysts, led by Chief U.S. Economist Michael Gapen, have indicated in a research report that the Federal Reserve is unlikely to take preemptive action, such as a rate cut in May, due to expectations of persistent inflation and the ongoing impact of tariffs. Despite U.S. President Donald Trump easing some tariff measures since April 2, known as 'Liberation Day,' which has somewhat stabilized the bond and stock markets, investors remain anxious about future developments. Gregory Peters, Co-Chief Investment Officer at PGIM Fixed Income, which manages $837 billion in assets, advises investors to continue exercising caution and reduce risk exposure.