BlackRock's Rosenberg says inflation could actually be peaking in recent data

Fade the hawkish Fed. Rosenberg argues inflation has peaked (core PCE > CPI noise), capping front-end yields. The real risk is the long end, where fiscal dominance & capex are repricing term premium higher. Massive Treasury supply requires higher yields to clear weak auctions. Buy the belly (2-5yr), short the long end. Bear steepener is the play. Credit is insulated by liquidity; sovereign debt is not.

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BlackRock 9.5
Asset Manager $10500.00B
Jeffrey Rosenberg 9.0

BlackRock's Rosenberg says inflation could actually be peaking in recent data

Host asks if Jeff agrees with Fed's view that next move could be a hike and inflation stays higher for longer.

Speaker1
Speaker2

Inflation could be at a peak; core PCE is improving, CPI was overstated due to shelter. Fed may not need to hike if inflation peaks.

Underlying core measures are looking better, tariff inflation is coming off, but oil pass-through is uncertain.
Host asks if yields are capped and if it's a good time to buy bonds.

Speaker1
Speaker2

Short-term yields react to headline inflation; long-term yields are driven by fiscal deficits, AI, energy, and global re-sourcing, pushing term premium higher.

The belly of the curve (2-5 year) offers fair risk-return if inflation uncertainty is at its tail end. Long end still has room to go higher.
Host asks if 10-year and 30-year yields are headed higher given global rate trends.

Speaker1
Speaker2

The 10-year vs 30-year spread needs to expand; inflation flattens the curve, but secular financing needs steepen it. Long end will underperform.

Belly of the curve is a better spot for investors; back end has more room to rise on fiscal demand.
Host asks if corporate bond supply will become too much and gap spreads or rates.

Speaker1
Speaker2

Corporate credit can absorb supply well due to strong demand from AI and liquidity; government debt is more risky and will need higher yields to clear auctions.

Credit spreads are tight, liquidity is abundant. Government auctions have been weak (C-minus grade), reflecting supply-demand mismatch; yields must rise to attract buyers.

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