Trump is stepping down... BlackRock CEO says "Large-scale investment will cause inflation... interest rates will rise"

718 Trillion Won Investment in U.S. AI Infrastructure
10-Year Treasury Yield Rises to 4.6% on Inflation Concerns
Fears of Stock Market Shock if Interest Rates Climb Due to Inflation

Larry Fink, CEO of BlackRock, the world's largest asset management firm (photo), predicted on the 23rd (local time) that the large-scale investment projects promoted by U.S. President Donald Trump could cause inflation, which in turn might lead to rising interest rates. This view directly contradicts President Trump's statement that falling oil prices would lower inflation and thus prevent inflation.

In an interview with CNBC on the same day, CEO Fink said, "If all private capital is unleashed, I think it would be very good for growth," but added, "At the same time, some of this will create new inflationary pressures."

CEO Fink stated, "I believe this risk has probably not yet been reflected in the market," and "The bond market will tell us where we are headed." The yield on the U.S. 10-year Treasury note rose from the mid-3.6% range in mid-September last year to the mid-4.6% range on this day, due to concerns that tariff policies around President Trump's election could cause inflation.

The large-scale investment project cited by CEO Fink as a factor causing inflation appears to refer to the U.S. artificial intelligence (AI) infrastructure investment announced by President Trump at a press conference held at the White House on the 21st (local time). President Trump announced that three companies?OpenAI, SoftBank, and Oracle?have jointly established an AI joint venture called Stargate and will invest at least $500 billion (approximately 718.5 trillion won) in AI infrastructure going forward.

CEO Fink expressed concern that such large-scale investments could drive up inflation. He said, "Depending on future developments, interest rates could become very high due to inflation," adding, "This would have a significant negative impact on the stock market." Typically, interest rate hikes are seen as negative for asset markets because they reduce liquidity in the market.

On the same day, President Trump gave mixed forecasts regarding interest rates. At a signing ceremony held at the White House, President Trump said, "If oil prices come down, prices will fall, and then inflation will disappear. Then interest rates will come down."

He also warned that the yield on the U.S. 10-year Treasury note might attempt to break above 5% and reach 5.5%, and if such a thing actually happens, the stock market could be shocked. Rising Treasury yields can lead to capital outflows from risk assets like stocks, potentially causing stock market corrections.

This content was produced with the assistance of AI translation services.