Morgan Stanley Fixed-Global Macro Commentary September 20-110413212

M Update Global Macro Commentary | Global September 20Morgan Stanley & Co. LLCAlexandra MaierStrategist Alexandra.Maier@morganstanley.com +1 212 761-0428 Morgan Stanley & Co. International plc+Dominic J KrummenacherStrategist Dominic.Krummenacher@morganstanley.com +44 20 7425-9781 Morgan Stanley & Co. LLCLenoy DujonUS/Canada Economist Lenoy.Dujon@morganstanley.com +1 212 761-2779 Morgan Stanley MUFG Securities Co., Ltd.+Hiromu UezatoResearch Associate Hiromu.Uezato@morganstanleymufg.com +81 3 6836-8431 Morgan Stanley Asia Limited+Gek Teng KhooStrategist Gek.Teng.Khoo@morganstanley.com +852 3963-0303 Morgan Stanley & Co. International plc+Arnav GuptaStrategist Arnav.Gupta@morganstanley.com +44 20 7677-0382 JPY weakens amid dovish BoJ press conference; Fed's Waller flags potential downside risks to inflation; USTs little changed; Fed's Bowman offers insight on her dissent; JGBs initially bear-steepen; IDR outperforms; DXY at 100.74 (0.1%); US 10y at 3.741% (2.8bp).• While the BoJ keeps rates on hold as expected, the press conference leans dovish as BoJ Governor Ueda says there is “room to spend more time” at the current rate level and that upside risks to inflation are easing; USD/JPY gains 0.8%.• Fed Governor Waller says that what concerns him is “inflation is running softer than [he] thought,” adding that if data comes in weak, he is willing to “be aggressive on rate cuts." • Front-end USTs initially cheapen in a partial retracement of the reaction to the FOMC, but reverse after the dovish remarks from Fed Governor Waller; USTs close marginally steeper, though little changed.• Fed Governor Bowman offers insight around her dissent at the September meeting stating that larger Fed cut could be viewed as a "premature declaration of victory on [the Fed's] price stability mandate.”• JGBs initially bear-steepen during the Tokyo session as market participants seemingly respond to strong nationwide services CPI and adjust positioning ahead of the LDP leader election.• IDR (+0.6%) continues to outperform peers as it is supported by bond inflows following the surprise BI rate cut, and the BI saying it is not intervening in the FX market as the volatility is manageable. Please refer to our recent publications and collaborations (Riksbank Preview: Back to Back; Mexico Economics & Strategy: Central Bank Preview: Keeping it Gradual; EM Fixed Income Flows Update: Where Supply Meets Demand; Podcast | Global: The Global Macro Guide: September 20th).Morgan Stanley does and seeks to do business with companies covered in Morgan Stanley Research. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of Morgan Stanley Research. Investors should consider Morgan Stanley Research as only a single factor in making their investment decision.For analyst certification and other important disclosures, refer to the Disclosure Section, located at the end of this report.+= Analysts employed by