Fed: See a gradual hiking path, but sense a subtle shift in tone - Morgan Stanley

In its latest client note released on Sunday, economists at Morgan Stanley offered their view on the Fed’s monetary policy outlook in the coming months.

Key Quotes:

“This past week, we heard from both the Chair and Vice-Chair

We think they've sent a consistent message: The Fed is data-dependent, but with the economy doing as well as it is today, it still anticipates a gradual hiking path.

While the bar for changing course remains high, we sense a subtle shift in tone relative to a few weeks ago, putting more emphasis on data dependence and signaling some flexibility on policy management after reaching neutral.”