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1. UBS: The Fed is expected to raise its inflation forecast, with most members believing that rate cuts are not advisable before 2028. The mid-range dot plot may show one rate cut in 2028, but the policy stance will remain tight. 2. Goldman Sachs: Warsh may not submit his personal dot plot forecast. The mid-range dot plot is expected to show interest rates unchanged in 2026, with the final forecast still showing one rate cut each in 2027 and 2028. The 2026 economic forecast may show a slight decrease in GDP growth and unemployment, and a significant upward revision in inflation. 3. Barclays: The latest dot plot may reflect higher inflation expectations and a more cautious policy stance, namely, keeping interest rates unchanged throughout 2026, only one rate cut in 2027, and remaining on hold in 2028. 4. Jefferies: Warsh clearly stated at his Senate hearing that he disagreed with forward guidance. This will be the biggest change, specifically manifested in a shorter FOMC statement and fewer details on the SEP. 5. Capital Economics: It is expected that Warsh will not present his own interest rate forecasts, but he will still be asked about his views at the press conference. 6. JPMorgan Chase: It is expected that Warsh will submit his personal forecasts; otherwise, it would appear as if he were expressing a strong dissent against the committee he leads. 7. TD Securities: It is expected that Warsh will not submit his personal dot plot forecasts as a strategic move to minimize the hawkish signals that the June dot plot might release. 8. Bank of America: It is expected that Warsh will not submit his personal forecasts, as he does not believe in forward guidance. Economic growth forecasts may be lowered to 2.1%, inflation will be significantly revised upward, and unemployment rate forecasts may be slightly lowered or remain unchanged. 9. Rabobank: It is expected that the risks are skewed towards more stubborn inflation, fewer rate cuts, or even rate hikes, rather than a rapid improvement. Optimistic expectations have failed to materialize. 10. Nordea: It is expected that the dot plot will no longer include the rate cut scenario anticipated in March, and there may even be some calls for rate hikes. 11. Bank of New York Mellon: Expects a slightly hawkish adjustment to the dot plot, with the median forecast likely to remove the previous prediction of one rate cut before the end of 2026. 12. Pacific Investment Management Company (PIMCO): Expects a significant hawkish shift to the dot plot. Several rate hikes are projected for 2026, but the median still indicates no change.June 17th - Despite investor skepticism regarding the Federal Reserves decision to maintain the target range for the federal funds rate at 3.50%–3.75%, Mabrouk Chetouane, an analyst at Natixis, noted in a report that this monetary policy meeting remains one of the most important this year. "Kevin Warshs first meeting as FOMC Chairman since taking office will present a formidable challenge," said the global head of market strategy. He pointed out that the new Fed chairman will not only need to assess the economic situation but may also push for change, particularly in central bank communication strategies. "His first move and initial statements will be closely watched, as transition periods in the worlds most influential monetary institution typically put pressure on capital markets."Australian Prime Minister Albanese: We are working to ensure Australias fuel supply. Today I met with Shells Global Chairman to discuss how to help the industry buy more fuel and ensure more fuel flows into Australia.The UKs retail price index rose 3.1% year-on-year in May, below the expected 3.3% and the previous reading of 3.00%.The UK retail price index rose 0.2% month-on-month in May, below the expected 0.5% and the previous reading of 0.70%.

Bitcoin Lightning Network-Based Strike Can Rival Visa – MS

Cory Russell

Apr 25, 2022 09:49

Morgan Stanley is optimistic about the bitcoin Lightning Network's potential as a consumer payment option.


They believe Strike, a Lightning Network-based payment technology, can compete with or even outperform Visa in the digital payments market.


Strike has partnered with Shopify and NCR, the world's leading supplier of point-of-sale payment solutions.


Morgan Stanley published a new analysis on the Lightning Network, bitcoin's Layer 2 fast payment system, and its potential to enable a "long-term move towards payments and settlements utilizing digital and cryptocurrencies rather than fiat currencies like the US dollar."


Morgan Stanley's positive analysis on the Lightning Network's potential for broader adoption comes after Strike, a US-based digital payments platform built on top of bitcoin's Lightning Network, announced earlier this month a new integration agreement with e-commerce giant Shopify.


Customers who paid in bitcoin will now be able to receive payments in US dollars from US Shopify businesses. Strike has announced collaborations with NCR, the world's leading supplier of point-of-sale (PoS) payment services.

Morgan Stanley Believes That Lightning Network Will Be Able to Compete With Visa

Morgan Stanley outlined why it believes Strike, a Lightning Network-based digital payment network, can compete with or perhaps exceed Visa in its recent study.


Morgan Stanley observes that "in essence, Strike is directly competing with Visa Direct, which provides real-time settlement," adding that "the primary distinction for merchants will be paid a significantly lower transaction cost."


"The customer advantage is that they may, if they choose, host their bitcoin on a private, secure network, enabling an element of secrecy connected with their transaction," the bank says.


Morgan Stanley emphasizes the importance of Strike's cooperation with NCR. "NCR software is used by one in every six PoS devices worldwide," the bank says, "so this news is important even if just a tiny percentage of retail businesses opt to add crypto capabilities."

Cons of Making Bitcoin Payments

The Morgan Stanley analysis points out some of the disadvantages of utilizing a bitcoin-based payment system, such as the cryptocurrency's underlying volatility on a day-to-day basis, which makes forecasting future buying power problematic.


Meanwhile, Morgan Stanley says that existing tax regulations, which require users to pay capital gains taxes on cryptocurrencies they sell, are a barrier to greater acceptance of bitcoin as a widely used means of exchange.


The bank, on the other hand, mentions the Virtual Currency Tax Fairness Act, which has been introduced in the US Congress. If passed, the law would exclude personal bitcoin transactions from taxation as long as the profits are less than $200.


Morgan Stanley, on the other hand, cautions that this plan may meet criticism, particularly from anti-crypto members of Congress, since it serves to establish bitcoin (and other cryptocurrencies) as credible alternatives to the US currency.


The Morgan Stanley analysis "suggests we are at the beginning of an age when more and more people may opt to pay for items using Bitcoin and cryptocurrencies over time," according to Alex Gladstein, who summarized it on Twitter.

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