BlackRock’s Larry Fink expects US Fed to cut rates at least twice in 2024, suggests to ‘test it out’
BlackRock Inc. Chief Executive Officer Larry Fink said he expects the Federal Reserve to cut rates twice at the most this year, and that it will be difficult for the central bank to curb inflation.
Fink would “call it a day and a win” if the inflation rate gets to between 2.8% and 3%, which is below the Fed’s 2% target, the CEO told CNBC Friday after the asset manager reported first-quarter results.
“I think 2% is a hard number” to achieve, said Fink, 71. “We have restructured how we frame our economic policy.”
The CEO said the Federal Reserve should “test it out” after one or two rate cuts, suggesting the central bank should see how the economy responds.
Fink has warned for about two years that inflation will prove sticky, taking a more conservative position at times than the market about how quickly the Fed will cut rates.
Inflation is persisting for longer than many expected, casting doubts on whether the central bank will cut interest rates this year. The core consumer price index, which excludes food and energy, rose 3.8% in March from a year ago — a hotter number than economists projected.
The Fed began a series of hikes in March 2022 as part of an effort to tackle inflation, which had been rising in the wake of the pandemic. Last month, the Fed kept the benchmark rate at 5.25%-5.5% — a two-decade high.
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Published: 12 Apr 2024, 09:32 PM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.