Inflation won't hit Fed's target and stocks to remain pressured: BlackRock

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Inflation won't come close to the Fed's target, and investors buying the dip in stocks should not hope for policymakers to save them, BlackRock says

report, which showed prices climbed 5% in March on an annualized basis, down from February's reading of 6%.

Though that increase was lower than economists' estimates, prices are still well above the Fed's long-run inflation target. Meanwhile, core CPI, which excludes volatile food and energy prices, increased 5.6% year-over-year in March, suggesting inflationary pressures are still present in the economy. for years, strategists said previously, and it suggests central bankers are likely to keep interest rates high this year. That bodes poorly for the outlook for the stock market.

"Recession is foretold as central banks try to bring inflation back down to policy targets," strategists said, warning investors who areas asset prices rebound."Rate cuts are not on the way to help support risk assets, in our view. That's why the old playbook of simply 'buying the dip' doesn't apply in this regime of sharper trade-offs and greater macro volatility," the note added.

Other Wall Street commentators have flagged the rising risk of a recession this year, which could continue to weigh on stocks. warned last week that the market still has plenty of downside ahead, as 80% of recessions since 1933 have sent stocks plunging at least 20%.

 

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