Rick Rieder Profile picture
@BlackRock global fixed income CIO & PM, focusing on big-picture trends shaping economy. Emory/Wharton alum; Orioles fan; Content intended for a U.S. audience.
Neil Brown Profile picture Max Runkle Profile picture GreatBiz? Profile picture fcbleasing Profile picture Laser_eyes_cat Profile picture 5 added to My Authors
May 4 16 tweets 12 min read
As was widely expected, the @federalreserve’s Federal Open Market Committee raised the target range for the Federal Funds #policy rate by 50 basis points (bps), to between 0.75% and 1.0%, and announced the start of #runoff of the central bank’s balance sheet. As previously suggested by the #Fed’s March minutes, the pace of runoff was confirmed today as $95 billion/month ($60 billion in U.S. #Treasuries and $35 billion in Agency #MBS, with a three-month phase-in period.
May 2 6 tweets 5 min read
While there is still considerable uncertainty over the forecast for #inflation, we think both Core #CPI and #PCE inflation peaked in March and February, respectively, and should move appreciably lower by the end of 2022. Image Throughout the pandemic, strong disposable #income and limited services spending fueled consumer #spending on goods and high goods volumes created #bottlenecks and extreme #inflation. Image
Mar 10 17 tweets 13 min read
A few months ago, #markets expected U.S. #inflation to peak by mid-2022 at around 7% to 8% at the headline level and then anticipated that generalized #price gains would decline into year end, closing the year around 4%. However, the tragic war now unfolding with Russia’s attack upon Ukraine has not only sent #energy prices skyrocketing but it has led to much greater uncertainty over #economic growth and #MonetaryPolicy reaction functions, in Europe and indeed around the world.
Feb 25 5 tweets 4 min read
As violent tragedy unfolds in Ukraine, what may appear as a relative lack of #market reaction in the U.S. belies the great uncertainty, lack of conviction and anemic #TradingLiquidity across #markets today. Indeed, only six times in the last 10 years has top-of-book #liquidity on the #SPX been as low as it has been recently.
Feb 10 15 tweets 8 min read
With respect to the data, #coreCPI (excluding volatile food and #energy components) came in at 0.6% month-over-month and at a high 6% year-over-year. Meanwhile, headline #CPI data printed at a strong 0.6% month-over-month and came in at 7.5% year-over-year, the greatest increase over a 12-month period since February 1982.
Jan 12 12 tweets 8 min read
Today’s #inflation report continued to reinforce the theme that gaudy #price gains are not standing in the way of demand. It is a very rare time in history, in fact, most people operating in #markets haven’t seen this sort of demand outstripping supply in the real #economy in their careers, with some areas seemingly depicting a dynamic suggesting that “price is no object.”
Oct 19, 2021 12 tweets 9 min read
Anyone perusing the top articles of major media outlets last weekend would have read several pieces on the extraordinary #shortages being witnessed in the U.S. #economy today, and particularly those in the #labor market. The tone of many articles was pessimistic, suggesting that the #supply-side #shortages and dislocations may be systemic, or long-term, but we think there’s evidence that the U.S. #economy will display considerably greater dynamism and resilience than the pessimists believe.
Oct 13, 2021 10 tweets 7 min read
With respect to today’s #inflation data, core #CPI (excluding volatile food and energy components) came in at 0.24% month-over-month and 4.04% year-over-year and was driven higher by strong increases in the #rent components, which have a tendency to be persistent. Further, headline #CPI data printed at a solid 0.41% month-over-month and came in at 5.38% year-over-year.
Oct 8, 2021 11 tweets 9 min read
September witnessed a somewhat disappointing nonfarm #payroll gain of 194,000 jobs, which was weaker than the upwardly revised August gain of 365,000 and was well below #economists’ consensus estimates of nearly 490,000 jobs. Clearly, there are significant #labor supply issues limiting the pace of recovery. Further, the #unemployment rate declined meaningfully, from 5.2% to 4.8% in Sept, and average hourly #earnings saw gains of 0.62% m-o-m, which brings the measure to 4.58% greater on a y-o-y basis.
Sep 23, 2021 10 tweets 7 min read
As expected, the @federalreserve’s Federal Open Market Committee continued to discuss its plans to reduce, or #taper, the pace of its #AssetPurchase program at yesterday’s meeting. While the details of this discussion were fairly sparse, the Committee statement did state that: “If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted.”
Sep 14, 2021 11 tweets 7 min read
In August we saw #inflation growth moderate further, for the second consecutive month, at least relative to the impressive rate of growth in #prices witnessed around mid-year. Core #CPI (excluding volatile food and energy components) came in at 0.10% month-over-month and 3.98% year-over-year, which was considerably less than the consensus forecast and was driven higher by #shelter components.
Aug 27, 2021 10 tweets 6 min read
It was 73 degrees and sunny in #JacksonHole, Wyoming, today; a perfect day for all those who were there…. Yet, there were no #monetary policy officials present at the traditional location of the @KansasCityFed’s late-summer #economic policy symposium, since they were conducting a “virtual symposium.”
Aug 11, 2021 7 tweets 6 min read
Inflation data for July moderated somewhat, at least relative to the heady pace of recent months, which should temper #market and policymaker concerns a bit, despite the fact that #inflation will stay sticky-higher for a while and the #risk remains to the high-side. Core #CPI (excluding volatile food and #energy components) came in at 0.3% month-over-month and 4.3% year-over-year, a bit less than the consensus forecast, and headline CPI data printed at a solid 0.5% month-over-month and came in at 5.4% year-over-year.
Jul 21, 2021 10 tweets 7 min read
Great conversation with @MerrillLynch CIO Chris Hyzy, as part of their #MerrillPerspectives event. Some of the topics we discuss follow and the full conversation can be accessed here: ml.com/2021-midyear-e… On the #market lessons stemming from the pandemic, I suggested that- stepping back- while a lot has been thrown at the #economy and markets over the past 30 years, in every case the #policy response has been critical to evaluate in judging the ultimate impact: policy matters!
Jul 13, 2021 9 tweets 8 min read
Today’s robust #inflation data surprised in its strength and will likely persist in the short-run, and in some areas the intermediate-term, although we think that long-term the @federalreserve is largely correct in identifying real #economy price gains as mostly #transitory. Much of today’s #inflation is due to reopening factors and supply constraints, but as #SupplyChains normalize from Covid-related shocks and #inventories rebuild, we expect much of the recent inflation will be transitory, with some stickiness in pricing pressure longer-run. Image
Jun 17, 2021 10 tweets 6 min read
At yesterday’s #FOMC meeting, the Committee revealed more expected tightening and further steps toward #tapering #asset purchases than they had previously. We see these as steps in the right direction. Yesterday’s @federalreserve statement and press conference suggest that the Committee believes progress has been made toward its goals, but that there’s still some room to go to hit the recently re-defined objective of maximum #employment.
Jun 1, 2021 10 tweets 7 min read
In our latest @BlackRock Market Insights commentary we argue that #inflation’s role in the #economic order can be misinterpreted, and therefore that #policy seeking to achieve positive ends can ironically become the means by which those ends are undone: bit.ly/3fyLn4O Today, policymakers face a set of increasingly critical choices that could end up shaping our quality of life for a generation. Changes to the #Fed’s #inflation framework, without being fully debated, may ironically end up exacerbating the very problems they seek to alleviate.
May 27, 2021 10 tweets 8 min read
The #economy and #markets today present us with a type of confusing environment: a tremendous growth rebound amid concerns over different forms of #overheating due to policy being late to normalize, and then the uncertainty of an ultimately harsher policy unwind down the road… … It’s in this kind of environment that we find that what #investors want to do can be very different from what they need to do – the opposite, or mirror image, in fact: bit.ly/3u0nmr9
Mar 1, 2021 10 tweets 9 min read
While our February 18th monthly client call argument for rising #RealRates appeared prescient, we were surprised by the magnitude of last week’s #move and would expect a more benign evolution toward #equilibrium going forward. Taking a stab at periodizing the past year: 1) in Feb/Mar 2020 the Covid crisis was priced into #markets, real #rates spiked higher, #inflation breakevens collapsed and #investors scrambled to raise #cash as the #SPX experienced its fastest 30% drawdown in history.
Jan 20, 2021 5 tweets 8 min read
The last several weeks have provided abundant drama for #markets to digest, but in our latest @BlackRock Market Insights commentary, we suggest that it’s two recent #publications that might prove more instructive for #portfolio #allocation in 2021: bit.ly/3p39aMo First, @jasonfurman and @LHSummers make a strong case that lackluster #growth and #inflation in developed #markets may be boosted by targeted #fiscal spending. Over long horizons, the #cash flows that accrue from productive #investments render the #debt incurred sustainable.
Dec 15, 2020 10 tweets 11 min read
The turn of the calendar year invites the temptation to prognosticate regarding the course of the year ahead for the #economy and for #markets, and not being immune to that impulse, here are our views on the “11 themes to consider as we look toward 2021:” bit.ly/386mb0r In preview, one key theme is that 2021’s nominal #GDP growth is likely to surprise many skeptics with its strength. The sources of upside surprise can be found in: 1) the new #fiscal #stimulus combined with structural budget #deficits