Morgan Stanley cite encouraging developments on reopening the economy, a faster pace of vaccinations, stronger job growth, fresh stimulus.
- sees the US unemployment rate falling to 4.9% this year
The 'cost' says MS is rising inflation:
- forecast 2.6% in April and May
- then easing back top 2.3% at the end of this year
- will stay at a similar level into 2022 (ie above the Fed target of 2%)
On the Fed, MS does not expect significant tightening until 2023
- but asset purchases will be scaled back from January 2022
