Fed is going to hike rates, says BlackRock's Rick Rieder

Summary

Rick Rieder of BlackRock expects the Fed to hike rates, though he personally would not and thinks the Fed should stop after one move. He is cautiously buying long Treasuries, likes the very front end and the BANK ETF for yield, and expects a flatter curve if the Fed hikes. He views stocks as only okay/B-minus, sees higher equity volatility, and flags rollover financing risk in real estate and bilateral credit finance.

• Fed is expected to hike rates, but Rieder argues a 25 bp move does little for inflation and hurts rate-sensitive areas.
• Long-end Treasuries are becoming more interesting; he is dabbling but remains cautious on supply pressure.
• He prefers the very front end of the curve and cites the ETF BANK for attractive yield and low duration.
• If the Fed hikes, he expects the Treasury curve to flatten and the long end to hold in.
• Equities are rated only okay/B-minus, with higher volatility and a real fixed-income alternative.
• Rollover financing risk is flagged for real estate and bilateral credit finance.
• AI remains a growth theme in his comments, but he does not detail a specific investable angle.