BlackRock Shifts to Positive Outlook on US Treasuries
Jean Boivin of BlackRock shifted the firm's stance to favor long-term US treasuries while adopting a more neutral view on AI-driven equities.
Investment manager BlackRock has shifted its investment stance, moving from a systematically negative view on long-term US treasuries to a more positive outlook. Jean Boivin indicated that 10-year treasury yields around 5.5% now align with the current economic environment, making them attractive for carry with limited risk of further capital loss over the next six to twelve months.
Simultaneously, the firm has become more neutral and circumspect regarding equities, specifically citing headwinds in the artificial intelligence sector. While AI earnings remain strong, the massive scale of projected build-outs—estimated at $7 trillion to $9 trillion by 2030—creates immense financing needs that drive up the cost of capital.
Boivin suggests that financing costs and societal concerns may temper the rapid pace of AI expansion, which would reduce upward pressure on yields. Despite these headwinds, he stated that the firm's fundamental convictions on AI remain intact.
