The Morgan Stanley Research Report pointed out that Federal Reserve Chairman Walsh's speech at the Jackson Hole annual meeting was clearly hawkish, stressing that inflation is still the top issue at present, and clarifying that short-term interest rates are the main tool for achieving policy goals. At the same time, he reiterated that the 2% PCE inflation target is a “firm and fixed” target. After the speech, the market once included a probability of about 58% of the 25 basis points of interest rate hikes in September, and it is expected that the cumulative interest rate hike will be about 44 basis points before the end of the year. However, Morgan Stanley has not changed its judgment because of this, and still expects the Federal Reserve to keep interest rates unchanged this year. The bank believes that Walsh is not a chairman who provides clear forward-looking guidance through speeches in the traditional sense, and that his hawkish statement is more about reserving policy choices than promising action in September. If the judgment is wrong and the Federal Reserve finally starts to raise interest rates, it is estimated that the overall amplitude of this round is more likely to be 50 to 75 basis points, rather than an aggressive austerity cycle of 100 to 150 basis points or more.

The Morgan Stanley Research Report pointed out that Federal Reserve Chairman Walsh's speech at the Jackson Hole annual meeting was clearly hawkish, stressing that inflation is still the top issue at present, and clarifying that short-term interest rates are the main tool for achieving policy goals. At the same time, he reiterated that the 2% PCE inflation target is a “firm and fixed” target. After the speech, the market once included a probability of about 58% of the 25 basis points of interest rate hikes in September, and it is expected that the cumulative interest rate hike will be about 44 basis points before the end of the year. However, Morgan Stanley has not changed its judgment because of this, and still expects the Federal Reserve to keep interest rates unchanged this year. The bank believes that Walsh is not a chairman who provides clear forward-looking guidance through speeches in the traditional sense, and that his hawkish statement is more about reserving policy choices than promising action in September. If the judgment is wrong and the Federal Reserve finally starts to raise interest rates, it is estimated that the overall amplitude of this round is more likely to be 50 to 75 basis points, rather than an aggressive austerity cycle of 100 to 150 basis points or more.