“In order to be a bull on stocks, all you have to believe is that you’ll get there within, say, the next three years,” the chief global strategist said Thursday on Bloomberg Television. “And I think it’s eminently doable.”

Stocks have enjoyed a significant rally since hitting a low in mid-June. The benchmark S&P 500 index rose to a three-month high on Wednesday as investors speculated that the softer-than-expected July consumer-price reading would push the Federal Reserve to slow its aggressive policy-tightening regime that took stocks on a wild ride this year. 

Kelly echoes this outlook.

“It’ll take a while to get inflation back down to 2%, but so long as we are making progress in that direction, there is no need to tip this economy into a recession,” Kelly said. “If you have a period where inflation is slowly coming down, the economy is trudging along but you’re able to maintain margins, I think it’s a pretty good outlook for the equity market.”

But stocks faltered on Thursday, even as a key measure of U.S. producer prices fell unexpectedly in July for the first time in over two years, as some investors wondered if the rally that followed the CPI data went too far. For Kelly, though, the combination of softer inflation readings and signs of an economic slowdown may lower the peak for interest rates, supporting higher equity prices.

“I would be fully invested in equities at this point because I do think that equities can move higher here,” he said.