BlackRock’s Rick Rieder urges 3% interest rates on soft jobs

Rick Rieder, who oversees fixed income at BlackRock and is under consideration to succeed Jerome Powell as Federal Reserve chair, is urging the central bank to lower the interest rates to 3% as labor conditions cool, Bloomberg reports. The rate currently sits in a 3.75%–4% target range after a quarter-point reduction last week.

He pointed to signs of weakening in hiring and argued that a lower policy rate would help support economic activity, including housing demand. The monthly payrolls report was delayed because of a government shutdown, but in his view it would likely have shown further slowing.

“We have a softening of the labor market that is quite significant,” Rieder noted. “The funds rate should be at three. I just think we can get it there and then take another view on where are we today.”

Rieder also emphasized that policy choices should be anchored in incoming figures. “I have incredible sympathy for, and the sanctity of, what that institution is,” he said of the Fed. “I certainly believe in this Fed chair and this Fed committee that I think they’re going to make the decision based on, let’s evaluate the data, interpret the data, and make a decision based on that.”

Fed officials cut rates last week and Chair Powell remarked that another reduction in December is “not a foregone conclusion.” Several policymakers in recent days have warned that easing too quickly could risk keeping inflation elevated.

The White House has narrowed the list of potential Fed chair candidates to board members Christopher Waller and Michelle Bowman, former Governor Kevin Warsh, National Economic Council Director Kevin Hassett, and Rieder. The president has indicated a decision is expected by year-end.

As GNcrypto covered previously, private estimates for October pointed to softer job creation as the official report was delayed by the shutdown. Announced layoffs rose 183% from a year earlier to 153,074 in October, the highest for that month in 22 years, lifting year-to-date cuts past 1 million and 65% above the same period in 2024. Firms pointed to cost reductions, AI-related restructuring, higher borrowing costs, tariffs, and slower investment.