BlackRock CEO Predicts Further Fed Rate Cuts Before Year-End

• Fink foresees a 25-basis-point Fed rate cut by 2024 amid sustained inflation pressures.  
• The November 6 FOMC meeting, post-U.S. election, may drive pivotal rate-cut decisions.  
• Fed plans three rate cuts in 2024, targeting inflation decline after a 22-year peak.

Larry Fink, CEO of BlackRock, discussed his expectations for the Federal Reserve’s upcoming policy decisions at the Future Investment Initiative in Saudi Arabia. He highlighted the ongoing monetary pressures and the challenges the Fed faces in responding to current economic conditions.

Speaking to a global audience, Fink said that the Federal Reserve may cut interest rates by another 25 basis points before the end of 2024 to balance rising costs.

This prediction has sparked discussion about the possibility of the Federal Open Market Committee (FOMC) making further rate cuts, with some concerned about a more aggressive 50 basis point cut.

FOMC Meeting and the US Election

The next FOMC meeting, scheduled for November 6 , is expected to be one of the greatest key financial policy discussions.

This session, taking place just a day after the U.S. election on November 5, could lead to decisions that will affect the national economy and financial markets.

Fink explained that inflation pressures are not just temporary and are more deeply rooted than in past economic cycles. He pointed to structural policies like onshoring and immigration changes that could have a long-term impact on the economy.

Federal Reserve Signals Three Rate Cuts in 2024

Fink’s statement comes after the Federal Reserve announced plans for three rate cuts in 2024 to ease inflation, which has reached a 22-year high.

Read also: Federal Reserve Anticipates Three Interest Rate Cuts in 2024

During the FOMC meeting, Federal Reserve Chair Jerome Powell acknowledged that inflation is gradually declining but said that a quick return to target levels is not guaranteed.

Powell stressed the need for continued reductions in inflation to ensure a stable downward trend, with the goal of reaching a 2% inflation target.

With a history of raising rates 11 times since the previous year, the Fed has made a move to fight inflation, reaching a collective increase of 5.25 percentage points since the beginning of this campaign.