Blackstone Hits Two-Year Investment Peak, Anticipates Fed Rate Cuts Amid Easing Inflation: Report

Blackstone Inc. BX reportedly ramped up its investment activity to a two-year peak in the second quarter, anticipating the U.S. Federal Reserve’s impending interest rate cuts.

The head of the private investment group based in New York informed the Financial Times that inflation appeared to be easing across its portfolio, including its substantial $336 billion property business.

“The Fed has and will have air cover to cut rates,” said Jonathan Gray, president of Blackstone, The Financial Times reported. “Their medicine has been working.”

During the quarter, Blackstone invested $33.7 billion and allocated an additional $19.1 billion to new ventures, marking its busiest period since 2022.

Gray cited their strategy to invest preemptively ahead of potential rate cuts by the Fed as driving the increased deal activity.

Gray commented as the group reported a 3% year-on-year rise in distributable earnings, slightly below analysts’ expectations.

Also Read: Blackstone’s Strong Q2 Drives Stock Higher: Assets Under Management Up 7%

He expressed confidence that the U.S. central bank would soon have the chance to ease monetary policy as inflation and the job market stabilized.

“Wage pressures have come off, and when we survey our companies, they are saying it is much easier to hire,” he noted.

He also mentioned that within its property portfolio, rent increases were occurring at a slower pace compared to what government data indicated. This trend is expected to eventually affect official inflation metrics used by the Fed to determine interest rates, Financial Times added.

Price Action: BX shares are trading higher by 2.62% to $138.38 at last check Thursday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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