Reported 5 months ago
BlackRock's Rick Rieder believes the Fed's interest rate hikes to combat inflation are not working as intended, as the private sector is now acting as a creditor rather than a borrower. Rieder suggests that the Fed may need to consider rate cuts to address the last remnants of inflation, as higher rates are benefiting cash-rich consumers and businesses, potentially fueling inflation. He points to older Americans' wealth and spending habits, along with large companies profiting from lending, as factors complicating the Fed's efforts to control inflation. Despite the Fed's current stance on rates, Rieder sees an opportunity for bond market investors to capitalize on higher yields in the current market environment.
Source: YAHOO