Morgan Stanley: The Federal Reserve is expected to only cut interest rates slowly, as they hope to ensure low inflation

The senior portfolio manager responsible for US stocks at Morgan Stanley said in an interview that he expects the FOMC to only gradually cut interest rates this year and will maintain "patience". The current performance of the US economy is strong, and the Federal Reserve has "time to be patient and ensure a true long-term downward trend in inflation." In addition, the inflation rate is "significantly lower than" the federal funds rate. He also stated that if the Federal Reserve sends signals indicating a need for faster interest rate cuts, it would make him somewhat nervous because it could mean that the pace of economic slowdown may be faster than he expected. As for 2024, he predicts that after a significant increase in the SP 500 index in 2023, it will be more challenging for the US stock market to continue rising in 2024. However, he believes that this year's market will go higher as earnings start to show. He expressed his support for maintaining a strong economy and stated that he has not seen any signs of economic slowdown.