Fed rate cuts in 2024? BlackRock’s CIO predicts more monetary easing ahead

Rick Rieder is BlackRock’s chief investment officer of global fixed income.

Recently he reiterated his call for two Federal Reserve rate cuts this year:

• “It’s getting harder for them to do that, but I still think they can,”

Dow Jones / Market Watch (gated) carried remarks from Rieder on Tuesday ahead of the Federal Open Market Committee (FOMC) meeting today. In brief:

• “core services inflation is just too high”
• How Powell addresses the potential for rate hikes to deal with sticky inflation will be important, because the market will likely react to that “big question,” Rieder told MarketWatch.
• Should Powell sound “hawkish” on Wednesday, the stock market would probably trade down against the backdrop of a jump in Treasury yields
• Rieder said his sense is that Powell doesn’t want to raise rates further.
• In Rieder’s view, the market has gone … too far in … in thinking the Fed might not cut rates at all in 2024.

  “If the data allows them, I still think [the Fed would] like to get a cut or two in this year,” Rieder said.

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The Federal Open Market Committee (FOMC)’s policy decision will be released on Wednesday May 1 at 2 pm US EDT (1800 GMT) with Fed Chair Jerome Powell following up with his press conference at 2:30 pm (1830 GMT).

Earlier previews:

• BoA on the FOMC meeting – more clarity on inflation is needed, in “want and see” mode

• FOMC meet this week: “the most interesting news about this meeting will come on 22 May”
• “Fed has simply run into a brick wall”
• expect a hawkish Fed and Powell
• Fed cuts are not imminent

This article was written by Eamonn Sheridan at www.forexlive.com.