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Morgan Stanley ditches December Fed rate‑cut call after strong jobs data
Morgan Stanley drops its December Fed‑cut forecast following a stronger US jobs print, shifting cuts to 2026.
Morgan Stanley reversed its forecast for a December Fed rate cut after U.S. job growth surprised on the upside. It now expects rate cuts in January, April, and June 2026 — projecting the policy rate to fall to between 3.00 % and 3.25%.
The firm cited a broad-based 119,000 increase in non‑farm payrolls in September, coupled with resilient economic momentum, as reasons for delaying its dovish pivot. Investors largely echoed this view, scaling back their expectations of a year‑end rate move.