BlackRock: Fed's interest rate tools can't keep up with the times Rate cuts are likely to take place at the end of 2024 or after

Rick Rieder, global head of fixed income at BlackRock, said that the Federal Reserve may start cutting interest rates in late 2024 or later. According to Rieder, sticky inflation is a big problem for the FOMC. The reason why inflation is so sticky is that the world has clearly shifted to services, especially experiential consumption, and you can see the same dynamics in the amazing prices that people are willing to pay to attend events or be with other people, so we see data today showing that services inflation is still very sticky. Finally, he explained that a key factor to understand here is that many of these areas are less sensitive to interest rates, so the Fed has a very difficult task in reducing these price levels through the blunt tool of the policy rate.