BlackRock Analyst: Fed Likely to Support a Rate Cut Under Waller's Leadership

05/25 10:05

On May 25, BlackRock stated that under the leadership of new Fed Chair Waller, there may be sufficient reasons to support a rate cut rather than a rate hike. Navin Saigal, head of BlackRock's Global Fixed Income business in Asia-Pacific, responded to questions about the likelihood of rate hikes during Waller's tenure, saying, "If I had to choose between a rate hike and a rate cut, I believe there are actually sufficient factors to support a rate cut." He added, "Looking ahead, the labor market will face some pressure, which may indicate that the Fed will either hold steady or cut rates." Saigal's comments contrast with the general expectations of bond investors, who are betting that Waller will prioritize maintaining the Fed's credibility in fighting inflation over accommodating President Trump's calls for lower interest rates. Current pricing shows that the market is almost certain the Fed will raise rates before December.
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