Morgan Stanley Wealth Management Investor Pulse Poll: Most Retail Investors Expect Interest Rate Hike by Mid-2016; Few Say They Are Adjusting Investment Portfolios in Advance

No Consensus on Whether Rate Hike Good or Bad for Economy

New York —

A majority of retail investors – 62% – expect the Federal Reserve to raise interest rates by mid-2016, with millionaires even more convinced a rate hike is coming (75%).

Yet most investors (55%), including millionaires, say they are not adjusting their investment portfolios in advance of a possible increase, by, for example, selling real estate investments or changing fixed income allocations. Among actions they say they have taken: 19% paid off consumer debt, 11% bought a car or other big ticket item, and 10% refinanced a mortgage.

There is no consensus on whether a rate hike will be good or bad for the economy: 31% of surveyed investors say good, 24% bad, 23% say neither good nor bad, and 22% are unsure.

These are among the findings of the latest Morgan Stanley Wealth Management Investor Pulse Poll, which this summer surveyed 1,000 U.S. households with at least $100,000 in investible assets, a third of which had investible assets of $1 million or more.

Those predicting a rate increase are divided on its magnitude. Most expect an increase of 0.5% (38%) or 0.25% (24%), while one in seven (14%) are unsure.

A majority of investors, 57%, express at least some concern that prolonged low interest rates have created a consumer assets bubble, but only 12% view this as a major concern.

Investors continue to have a positive economic outlook: 76% of those surveyed believe the global economy will be the same or better over the next 12 months and 78% believe that of the U.S. economy.

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Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, wealth management and investment management services. With offices in more than 43 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com.

Media Relations: James Wiggins, 914.225.6161; Christy Jockle, 914.225.6827

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