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Morgan Stanley`s FOMC preview out overnight.....>

FED
FED: Morgan Stanley`s FOMC preview out overnight reiterates their call for a
50bps funds rate cut next week (putting their economists alongside only UBS's in
that camp as far as MNI is aware).
- Looking for a dovish presser from Powell, emphasising global growth/trade
downside risks.
- Statement to reiterate `will act as appropriate`.
- Base case is for market to price in 40-60bps of further cuts (i.e. beyond the
50bps in July) by end-2019; likes 2s10s/2s30s steepeners and long FFQ9 and FFU9.
- Sees weaker USD vs EM (esp INR, RUB, BRL, MXN) and JPY on dovish Fed.
- If only 25bps delivered, expect to be accompanied by more explicit easing bias
(i.e. `closely monitor`), pointing to 25bps cut in September.

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