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Most Trending
-8.97%
-4.37%
-0.07%
+1.66%
+5.77%
Most Trending
-8.97%
-4.37%
-0.07%
+1.66%
+5.77%
While investors fear a recession and banks struggling with high interest rates may lead the Fed to cut rates, the world's largest asset manager claims that the bank is determined to combat inflation, as reported by Bloomberg. Therefore, BlackRock is currently inclined to invest minimally in developed markets.
BlackRock's strategists assert that despite the recent turbulence in the American banking sector, including the collapse and decline of shares in medium-sized banks like SVB and First Republic, the Fed is committed to maintaining its hawkish policy against the rising inflation in the economy.
Chairman Jerome Powell and other senior officials at the bank have emphasized their determination to combat rising prices, as inflation in the US remains well below its 2% target.
"We will not see the Fed lower interest rates this year. In the past, it was customary for the Fed to rush to lower interest rates in order to save the economy from recession, but the situation now is different than before. We are now in a new phase that we have not encountered, in which the Fed carefully fights inflation," said the strategists at Blackrock .
TD Securities and DoubleLine Capital LP, along with BlackRock, contend that the Fed's policy of raising interest rates is misguided, as it could push the economy towards a recession. They argue that the recent collapses of banks, including Credit Suisse in Switzerland, call for a fresh global approach from central banks, leading to the highest volatility in government bond yields in over a decade.
The recent decline in bond yields following the bank collapses suggests that the market anticipates the Fed may soon stop or even lower interest rates. Prior to the bank collapses in March, the market had anticipated further interest rate hikes by the Fed in order to combat inflation. BlackRock, as previously mentioned, argues that the Fed's intentions and statements should be taken seriously, as they are committed to maintaining high interest rates despite the risks to the banking sector, which may have caused some investors to doubt their intentions.
Despite the Fed's plan to raise interest rates by 0.25% in May before potentially halting or lowering them in the future until inflation reaches 2%, the market anticipates a 65 basis point decrease in the two-year bond yield by the end of 2023.
Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.
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Disclaimer:
The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained.
The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.
Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").
This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.
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Disclaimer:
The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained.
The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.
Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").
This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.
