BlackRock CEO Larry Fink warns of 20% stock market drop, says US may already be in recession

Global markets could face deeper losses as the US economy teeters on the edge of a recession, BlackRock CEO Larry Fink warned on Monday.

Speaking at the Economic Club of New York, Fink said stock markets might fall by another 20% as steep tariffs imposed by the United States put upward pressure on inflation and weigh heavily on investor sentiment.

Fink, who leads the world’s largest asset manager with over $11 trillion in assets under management, voiced concerns about stronger-than-expected inflationary forces.

He noted that the market may be underestimating the persistence of inflation, making it harder for the Federal Reserve to ease monetary policy in the coming months.

“Most CEOs I speak with believe we’re already in a recession,” Fink said, pointing to insights from business leaders across sectors.

He cited a conversation with a top airline executive, who described the airline industry as a "canary in the coal mine" — and warned that "the canary is already sick," signaling broader economic troubles.

Despite the grim outlook, Fink emphasized that the recent market downturn could present long-term buying opportunities rather than systemic financial risks.

However, he cautioned that the aggressive tariff policies under President Donald Trump could fuel further inflation, complicating the Fed’s ability to cut interest rates as many investors hope.

“This belief that the Federal Reserve will cut rates four times this year? I see zero chance of that happening,” Fink said.

“I’m more concerned that inflation could stay elevated, potentially pushing rates even higher.”

Currently, futures markets are pricing in a full percentage point of rate cuts by the end of 2025, according to the CME FedWatch tool.

However, Fink’s comments suggest that traders may need to significantly adjust their expectations as inflationary pressures persist.

Fink’s remarks were broadcast live on Bloomberg Television, drawing wide attention from investors, analysts, and policymakers concerned about the future of the US economy.