The market expects the Federal Reserve to cut rates in December, while Morgan Stanley maintains that rate cuts will occur in June and September.

CoinFeed reported on March 17th that Morgan Stanley maintains its forecast that the Federal Reserve will resume rate cuts in June and again in September, despite soaring oil prices prompting traders to reduce their bets on the extent of rate cuts this year. "We still predict action in June and September, although there is a risk of delays," said Michael Gapen, Morgan Stanley's chief U.S. economist, during a Bloomberg News roundtable discussion in New York on Monday. This forecast contradicts the market's rush to rule out rate cuts, as the surge in oil prices following the Iran war could reignite inflation, potentially hindering the Fed's ability to ease monetary policy. Futures linked to the Fed's policy rate currently expect a 25 basis point cut in December, compared to expectations of at least a 50 basis point cut this year just last month. The market expects a 60% probability of a 25 basis point cut in September.