BLK · Earnings call · 2026Q3T · Full report

Interest Rate Environment

BlackRock, Inc. · 2026-10-14 · Importance 17 · Surprise 24

Management said higher base rates could restore constructive allocations to private credit and retail BDCs in the direct-lending market. It specifically referenced SOFR rates rising and stated that private-credit performance has remained resilient. BlackRock expects a more constructive environment in the fourth quarter and first half of next year for evergreen structures, driven by returns and cash-on-cash yields. Despite redemptions remaining in the queue, management said it is having constructive discussions with distributors.

Key facts

• BlackRock reported that federal deficits after 232 years were $8 trillion and 26 years later are $40 trillion.
• BlackRock expects structurally higher interest rates for longer, especially out the curve.
• BlackRock said the 10-year Treasury yields more than 5% and real rates are close to 3%.
• SOFR rates go up.