BlackRock’s Rick Rieder says core inflation is peaking and will fall to mid-twos
Core inflation is peaking and will fall to the mid-twos within the next few months, according to BlackRock Inc.’s chief investment officer of global fixed income, Rick Rieder.
Source: Morningstar · September 22, 2026 at 9:32 PM · AI-assisted report
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KUALA LUMPUR, 23 SEPTEMBER 2026 —
Core inflation is peaking and will fall to the mid-twos within the next few months, according to BlackRock Inc.’s chief investment officer of global fixed income, Rick Rieder.
Market Impact
The core Personal Consumption Expenditures Price Index rose 3.3% in July from a year earlier, Morningstar reported. Rieder told the publication that a productivity revolution in logistics and inventory management will help push price pressures down over the next couple of years.
Headline figures remain elevated because the war is keeping energy prices high, Rieder said in the interview. That dynamic could prevent the Federal Reserve from easing policy immediately, he told Morningstar.
Sticky sectors like healthcare, education, insurance, and shelter are largely unresponsive to interest rates, Rieder said. He warned that forcing those prices down would require sending the broader economy into a recession.
The central bank will likely raise rates once more this year before pausing, according to Rieder. He said the federal funds rate could see another hike next year depending on the path of core PCE.
Turning to fiscal policy, Rieder gave U.S. Treasury Secretary Scott Bessent a passing grade for attempting to curb rising long-term yields. The U.S. currently carries $40 trillion in debt, he noted.
Long-term U.S. yields could climb another 25 to 40 basis points, Rieder told Morningstar. He manages the USD 50 billion BlackRock Strategic Income Opportunities Fund and the iShares Flexible Income Active ETF, which holds a 7.2% yield.
Higher yields across developed markets are creating generational opportunities for pension funds and insurance companies, Rieder said. He told Morningstar he has added Japanese government bonds and European credit to his portfolios.
For Malaysian institutional investors managing global portfolios, shifts in U.S. Treasury yields and Federal Reserve rate expectations dictate capital flows across emerging market debt assets.
Related: BlackRock · US Treasury · Rick Rieder