BlackRock CEO: If the economy continues to perform strongly, the Fed may raise interest rates

Odaily Planet Daily News According to Larry Fink, CEO of BlackRock, he shared his views on the Interest Rate in the United States, stating that although there may be a rate cut in the near future, the Fed could also raise rates if the economy continues to perform strongly. Fink admitted at the World Economic Forum in Davos, Switzerland, that there is a high likelihood of interest rate hikes after next year, but he emphasized that this is not his primary forecast. He highlighted several key factors that could lead to sustained inflation, such as labor shortages and wage increases. While wage increases are usually seen as beneficial to workers, Fink pointed out that they could also exacerbate inflationary pressures. He further noted that material shortages, especially in industries related to large-scale infrastructure and energy transition, could exacerbate these inflationary trends. He also mentioned the bond market, saying that the yield curve has returned to normal after a period of inversion caused by high inflation. But he warned that future inflation expectations could further steepen the yield curve. Globally, Fink expressed concerns about rising deficits and debt levels, noting that these factors could push up financing costs and long-term bond yields. Overall, Fink paints a strong economic picture, citing robust corporate profits and optimistic labor market data. While he expects the Federal Reserve to not immediately cut interest rates, he states that further data in the coming months will be crucial in determining whether the Fed will hike rates again.