---
title: BlackRock Evaluates Short-Term Treasuries
description: BlackRock Investment Institute sees higher yields as an opportunity for investors to invest in shorter-term U.S. Treasuries Richard Turnill's weekly commentary also reviews global fears over U.S.-imposed trade tariffs, remarks from the Fed about 2018 interest rate hikes and possible changes in China
image: https://www.letsassemble.com/hubfs/blog-files/BlackRock5Mar2018.png
---

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# BlackRock Evaluates Short-Term Treasuries

Posted by [ WrapManager's Investment Policy Committee](https://www.letsassemble.com/wealth-management-blog/author/wrapmanagers-investment-policy-committee)  
 March 8, 2018

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## *[![BlackRock-long-on-short-bonds-mar-2018](https://www.letsassemble.com/hs-fs/hubfs/blog-files/BlackRock5Mar2018.png?width=404&name=BlackRock5Mar2018.png "BlackRock-long-on-short-bonds-mar-2018")](https://www.letsassemble.com/hubfs/MM_Commentary_PDFs/BlackRock-Commentary-Mar-2018.pdf)Long on Short Bonds...*

The steady increase in shorter-maturity bond yields provides a thicker cushion against concerns around further rises in interest rates. Interest rates would need to jump more than one percentage point to wipe out a year of income in the two-year Treasury note. This is nearly double the cushion on offer two years ago – and far larger than the thin insulation provided by longer-term bonds today. We believe the short end offers relatively compelling income along with a healthy buffer against the prospects of further increases in yields.

 

Read an excerpt of BlackRock's commentary below, or [download the complete commentary now](https://www.letsassemble.com/hubfs/MM_Commentary_PDFs/BlackRock-Commentary-Mar-2018.pdf).

## Key Points

1. **We see higher yields as an opportunity for investors to add exposure to shorter-term U.S. Treasuries.** A rapid rise in short-term yields in U.S. government debt is restoring their appeal. This marks a major shift away from the post-crisis era of near-zero yields on such instruments. The upshot: Investors now have a viable alternative to cash with yields finally above inflation levels.
2. **Global stocks fell on fears over U.S.-imposed trade tariffs, while remarks from the Fed chair cemented the idea of at least three 2018 rate hikes.** Global equities suffered another setback as U.S. President Donald Trump said the United States will impose tariffs on steel and aluminum imports — a move likely to increase tensions with major trading partners, including China. Fed Chair Powell’s first testimony to Congress briefly pushed benchmark Treasury yields back near four-year highs.
3. **China’s National People’s Congress is expected to rubber stamp a broad government overhaul that further centralizes power. **The changes point to more centralized leadership within the Communist Party, tighter financial regulation and a smoother path for President Xi Jinping’s flagship reforms. Among the changes expected are a status upgrade for the People’s Bank of China (PBOC) to bolster its independence. A new PBOC governor is set to be named shortly as well. A decision is also expected to be made on a proposed constitutional amendment removing the term limits on the president and vice president.

[Download BlackRock's complete commentary](https://www.letsassemble.com/hubfs/MM_Commentary_PDFs/BlackRock-Commentary-Mar-2018.pdf), or read one of their previous commentaries: *[An Upside U.S. Growth Surprise](https://www.wrapmanager.com/wealth-management-blog/blackrock-commentary-an-upside-us-growth-surprise)*.

 

To [learn more about the performance and investment strategies of BlackRock](https://www.wrapmanager.com/blackrock-performance-information-research-reviews), or other Money Managers, give us a call at 1-800-541-7774 or [contact us here](https://www.wrapmanager.com/contact) to speak with a knowledgeable Wealth Manager about whether they could be right for you.

 

[Download Full Commentary Here](https://www.letsassemble.com/hubfs/MM_Commentary_PDFs/BlackRock-Commentary-Mar-2018.pdf)

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