Morgan Stanley strategists stated in a report that recent data suggest the Federal Reserve will likely hold rates steady at its July meeting and may keep rates unchanged for the remainder of the year. They wrote: “The Fed is running out of patience with inflation remaining above target. The inflation trend in the coming months will be crucial—we expect inflation to fall as anticipated. Otherwise, the Fed may switch to raising rates later this year.” Currently, money markets have priced in nearl

Morgan Stanley strategists stated in a report that recent data indicates the Federal Reserve will stand pat at the July meeting and may keep interest rates unchanged for the remainder of this year. They wrote: “The Federal Reserve is losing patience with above-target inflation. The inflation trend in the coming months is crucial—we expect inflation to decline as anticipated—otherwise, the Federal Reserve may shift to raising rates later this year.” Currently, the money market has already priced in nearly two rate hikes by the Federal Reserve before the end of the year. However, the ongoing slowdown in inflation could prompt the Federal Reserve to keep rates unchanged this year, maintaining the federal funds rate in the 3.50% to 3.75% range. “We expect the downward trend in inflation to keep the Federal Reserve on hold this year.”