Federal Reserve rate cut expectations are diminishing, with the markets scaling back from their original forecasts of six rate reductions in 2024. BlackRock’s Global Co-Head of Bond ETFs Steve Laipply shares his insights on the fixed revenue landscape amid the growing uncertainty surrounding the Fed’s policy path.
Laipply acknowledges the “dramatic shift” in rate cut expectations, but believes there could be a single rate cut as soon as November. However, he notes that after that point, “it’s unclear” whether any additional cuts beyond that in 2024.
Addressing the fixed-revenue sector, Laipply advises investors “to start moving out of cash and back into fixed revenue.” He acknowledges that the recent Fed tightening cycle had driven investors away from the asset class, but he emphasizes that it will be “impossible for investors to time rate cuts,” suggesting that it is now an opportune time to gradually reallocate to fixed revenue.
Laipply outlines three potential scenarios for investors to consider: For those who believe in a soft landing scenario, he recommends “moving back out into broad fixed revenue.” For those who expect inflation to remain stubbornly high, he suggests focusing on treasury exposure and things like short-dated TIPS. For those who anticipate a hard landing, he advises longer duration fixed revenue resources.
#youtube #news #stockmarket
About Yahoo financial:
Yahoo financial provides free stock ticker data, up-to-date news, investment mix management resources, comprehensive sector data, advanced tools, and more information to help you manage your financial life.
– Get the latest news and data at financial.yahoo.com
– Download the Yahoo financial app on Apple (https://apple.co/3Rten0R) or Android (https://bit.ly/3t8UnXO)
– Follow Yahoo financial on social:
X: http://twitter.com/YahooFinance
Instagram: https://www.instagram.com/yahoofinance/?hl=en
TikTok: https://www.tiktok.com/@yahoofinance?lang=en
Facebook: https://www.facebook.com/yahoofinance/
LinkedIn: https://www.linkedin.com/enterprise/yahoo-financial
Disclaimer:
If you own the YouTube channel related to this video and do not want it to be featured here, you can contact us through our contact page. We will gladly remove it without questioning your reason