Don't look for a rise in U.S. interest rates until 2018, Morgan Stanley strategists said on Monday as they released their latest outlook. The Federal Reserve won't be able to hike rates this year or next year because U.S. economic growth will let down the bulls, according to these strategists.

"We think global growth really disappoints over the next 12 months -- particularly in developed markets, particularly in the U.S," said Andrew Sheets, Morgan Stanley's chief cross-asset strategist, on Monday.


The fundamentals for U.S. consumers are weaker than other forecasters think they are, said Elga Bartsch, Morgan Stanley's chief European economist. She cited relatively sluggish income growth, ongoing balance sheet repair (meaning people are eliminating debt and saving up) and wealthy Americans getting rattled by Brexit.

And now, we're talking 2018 for (really, truly this time) getting on a rate-hike path. Funny, Bernanke first talked as if Fed policy normalization was just around the corner ... in 2009.

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