{"id":1096236,"date":"2021-12-07T20:44:33","date_gmt":"2021-12-08T01:44:33","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1096236"},"modified":"2021-12-07T20:44:35","modified_gmt":"2021-12-08T01:44:35","slug":"morgan-stanley-analysts-not-that-concerned-about-omicron-variant-worried-about-federal-reserve-policy","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/morgan-stanley-analysts-not-that-concerned-about-omicron-variant-worried-about-federal-reserve-policy\/","title":{"rendered":"Morgan Stanley Analysts \u2018Not That Concerned\u2019 About Omicron Variant, Worried About Federal Reserve Policy"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">28<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fmorgan-stanley-analysts-not-that-concerned-about-omicron-variant-worried-about-federal-reserve-policy%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1096236&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>Morgan Stanley analysts cautioned that the Federal Reserve\u2019s forthcoming withdrawal of monetary stimulus is more concerning than the Omicron coronavirus variant.<\/p>\n<p>Last month \u2014 following nearly two years of aggressive quantitative easing after COVID-19 and the lockdown-induced recession \u2014 the Fed <a href=\"https:\/\/www.dailywire.com\/news\/as-high-inflation-persists-federal-reserve-unveils-first-official-plan-to-roll-back-stimulus&#039;\">announced<\/a> plans to taper its $120 billion in monthly bond purchases by $15 billion in both November and December. However, the central bank has been eyeing a faster pullback of monetary aid in response to high inflation and an improving labor market.<\/p>\n<p><a href=\"https:\/\/www.foxbusiness.com\/economy\/federal-reserve-bigiger-stock-market-risk-omicron-variant\">Fox Business<\/a> reported:<\/p>\n<p>The newest coronavirus variant may have fueled stock-market volatility in recent days, but Morgan Stanley analysts are arguing that stock investors should be more concerned about the Federal Reserve and its newfound response to the \u201con fire\u201d economic data.&nbsp;<\/p>\n<p>In a note to clients, the strategists \u2014 led by Michael Wilson \u2014 said they are \u201cnot that concerned about omicron as a major risk factor for equities,\u201d but warned of possible headwinds after Fed Chairman Jerome Powell last week suggested the U.S. central bank may accelerate its withdrawal of pandemic support for the U.S. economy.<\/p>\n<p>\u201cTapering is tightening for the markets and it will lead to lower valuations like it always does at this stage of any recovery,\u201d the analyst note said.&nbsp;<\/p>\n<p>The investment bank\u2019s warning comes after Goldman Sachs <a href=\"https:\/\/www.dailywire.com\/news\/goldman-sachs-lowers-2022-gdp-growth-projections-due-to-omicron-variant\">revised<\/a> its 2022 economic growth outlook from 4.2% to 3.8% due to uncertainty surrounding the new virus strain.<\/p>\n<p>During <a href=\"https:\/\/www.dailywire.com\/news\/in-remarks-to-congress-powell-says-omicron-complicates-inflation-forecasts\">testimony<\/a> to the Senate Banking Committee last week, Powell acknowledged that the inflation rate is running \u201cwell above\u201d the Fed\u2019s 2% long-run target.<\/p>\n<p>\u201cMost forecasters, including at the Fed, continue to expect that inflation will move down significantly over the next year as supply and demand imbalances abate,\u201d he explained. \u201cIt is difficult to predict the persistence and effects of supply constraints, but it now appears that factors pushing inflation upward will linger well into next year. In addition, with the rapid improvement in the labor market, slack is diminishing, and wages are rising at a brisk pace.\u201d<\/p>\n<p>\u201cWe understand that high inflation imposes significant burdens, especially on those less able to meet the higher costs of essentials like food, housing, and transportation,\u201d he added. \u201cWe are committed to our price-stability goal. We will use our tools both to support the economy and a strong labor market and to prevent higher inflation from becoming entrenched.\u201d<\/p>\n<p>The Personal Consumption Expenditures Price Index, which serves as the Fed\u2019s preferred inflation metric for charting monetary policy decisions, <a href=\"https:\/\/www.dailywire.com\/news\/the-feds-favorite-inflation-measure-hits-three-decade-high\">hit<\/a> a year-over-year rate of 4.1% in October \u2014 its highest level since 1991.<\/p>\n<p>In October, prominent hedge fund manager Bill Ackman <a href=\"https:\/\/www.dailywire.com\/news\/top-hedge-fund-ceo-calls-for-fed-to-hit-brakes-on-inflation\">argued<\/a> that \u201cthe Fed should taper immediately and begin raising rates as soon as possible.\u201d<\/p>\n<p>\u201cWe are continuing to dance while the music is playing, and it is time to turn down the music and settle down,\u201d he explained. \u201cAs we have previously disclosed, we have put our money where our mouth is in hedging our exposure to an upward move in rates, as we believe that a rise in rates could negatively impact our long-only equity portfolio.\u201d<\/p>\n<p>The Daily Wire is one of America\u2019s fastest-growing conservative media companies and counter-cultural outlets for news, opinion, and entertainment. Get inside access to The Daily Wire by becoming a <a href=\"https:\/\/www.dailywire.com\/subscribe\">member<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Morgan Stanley analysts cautioned that the Federal Reserve\u2019s forthcoming withdrawal of monetary stimulus is more concerning than the Omicron coronavirus variant.Last month \u2014 following nearly two years of aggressive quantitative easing after COVID-19 and the lockdown-induced recession \u2014 the Fed announced plans to taper its $120 billion in monthly bond purchases by $15 billion in both November and December. However, the central bank has been eyeing a faster pullback of monetary aid in response to high inflation and an improving labor market.Fox Business reported:The newest coronavirus variant may have fueled stock-market volatility in recent days, but Morgan Stanley analysts are arguing that stock investors should be more concerned about the Federal Reserve and its newfound response to the \u201con fire\u201d economic data.\u00a0In a note to clients, the strategists \u2014 led by Michael Wilson \u2014 said they are \u201cnot that concerned about omicron as a major risk factor for equities,\u201d but warned of possible headwinds after Fed Chairman Jerome Powell last week suggested the U.S. central bank may accelerate its withdrawal of pandemic support for the U.S. economy.\u201cTapering is tightening for the markets and it will lead to lower valuations like it always does at this stage of any recovery,\u201d the analyst note said.\u00a0The investment bank\u2019s warning comes after Goldman Sachs revised its 2022 economic growth outlook from 4.2% to 3.8% due to uncertainty surrounding the new virus strain.During testimony to the Senate Banking Committee last week, Powell acknowledged that the inflation rate is running \u201cwell above\u201d the Fed\u2019s 2% long-run target.\u201cMost forecasters, including at the Fed, continue to expect that inflation will move down significantly over the next year as supply and demand imbalances abate,\u201d he explained. \u201cIt is difficult to predict the persistence and effects of supply constraints, but it now appears that factors pushing inflation upward will linger well into next year. In addition, with the rapid improvement in the labor market, slack is diminishing, and wages are rising at a brisk pace.\u201d\u201cWe understand that high inflation imposes significant burdens, especially on those less able to meet the higher costs of essentials like food, housing, and transportation,\u201d he added. \u201cWe are committed to our price-stability goal. We will use our tools both to support the economy and a strong labor market and to prevent higher inflation from becoming entrenched.\u201dThe Personal Consumption Expenditures Price Index, which serves as the Fed\u2019s preferred inflation metric for charting monetary policy decisions, hit a year-over-year rate of 4.1% in October \u2014 its highest level since 1991.In October, prominent hedge fund manager Bill Ackman argued that \u201cthe Fed should taper immediately and begin raising rates as soon as possible.\u201d\u201cWe are continuing to dance while the music is playing, and it is time to turn down the music and settle down,\u201d he explained. \u201cAs we have previously disclosed, we have put our money where our mouth is in hedging our exposure to an upward move in rates, as we believe that a rise in rates could negatively impact our long-only equity portfolio.\u201dThe Daily Wire is one of America\u2019s fastest-growing conservative media companies and counter-cultural outlets for news, opinion, and entertainment. Get inside access to The Daily Wire by becoming a member.<\/p>\n","protected":false},"author":99,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1096236","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1096236","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/99"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1096236"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1096236\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1096236"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1096236"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1096236"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}