According to BlockBeats, on June 27th, Morgan Stanley maintained its baseline forecast of keeping interest rates unchanged this year, but warned that if the unemployment rate falls below 4% or inflation remains high, this assessment would be forced to shift towards raising interest rates. Analyst Michael Gapen noted in a client report that data since the June FOMC meeting has made the bank "somewhat reassured" about its "no rate hike" baseline—oil prices fell after the signing of the US-Iran memorandum of understanding, and the tariff transmission effect is expected to peak. Morgan Stanley forecasts overall and core PCE inflation of 3.2% and 3.0% respectively in the fourth quarter, well below the median expectation of FOMC participants. Regarding the labor market, Morgan Stanley expects 50,000 to 60,000 new jobs added per month this summer, enough to keep the unemployment rate roughly flat.

However, Gapen warned that if the unemployment rate falls below 4.0%, the Federal Reserve may consider the risk of an overheated labor market sufficient to justify raising interest rates; if the monthly core inflation rate remains at or above 0.3%, or if the conflict in the Middle East escalates again, this view will be reassessed. This assessment came as Brent crude oil had fallen to around $72.6, and the market is closely watching subsequent employment and inflation data to calibrate its policy expectations for the Fed under Warsh's leadership.