BlackRock Shifts Strategy to Overweight US Treasuries

BlackRock Inc. has shifted its investment strategy to become more bullish on US Treasuries, ending a six-year period of maintaining an underweight position. The firm's research arm, the BlackRock Investment Institute, upgraded short-term Treasuries to overweight and moved longer-term debt from underweight to neutral.

This strategic pivot follows a climb in yields to their highest levels in more than two decades. The firm believes that current market expectations for Federal Reserve tightening may be excessive, creating a more favorable environment for government debt.

In addition to the US Treasury shift, the company trimmed its underweight position in Japanese government bonds. Rick M. Rieder, the Chief Investment Officer of Global Fixed Income, co-authored the strategy note detailing these changes.