#Morgan Stanley: March rate cut likely#

Morgan Stanley believes that while the recent US nonfarm payrolls report may reduce the likelihood of a Fed rate cut in the near term, the possibility of a rate cut in March remains high due to a more favorable inflation outlook. Morgan Stanley said its optimism on the inflation outlook is based on expectations of continued declines in inflation data, which would give the Fed more room to lower rates. Nevertheless, the Fed will need to carefully monitor economic data and assess the sustainability of the decline in inflation before cutting rates.