BlackRock Cautions Against Long-Term Bonds

Leading asset management firm, BlackRock, warns that longer-term U.S. Treasury bonds may face risks if the Federal Reserve’s anticipated interest rate cuts clash with persistent inflation. Despite the Fed’s dovish stance, expecting three rate cuts this year amidst stronger economic growth, stubborn inflation could challenge this outlook. According to David Rogal of BlackRock’s Fundamental Fixed Income Group, the current bond prices for intermediate and long-term maturities don’t adequately account for the possibility of the Fed maintaining higher interest rates for an extended period