U.S. Markets

U.S. economic growth slower than France, 'terrible': BlackRock's Fink

CHICAGO (Reuters) - BlackRock Inc Chief Executive Officer Larry Fink on Friday sounded another warning on the U.S. economy after the government reported anemic growth in the first quarter.

Larry Fink, Chief Executive Officer of BlackRock, takes part in the Yahoo Finance All Markets Summit in New York, U.S., February 8, 2017. REUTERS/Lucas Jackson - RTX305I0

“We’re actually decelerating,” Fink, whose firm is the world’s biggest asset manager, said during a talk at the Morningstar Investment Conference in Chicago.

The U.S. economy is growing “slower than France - that’s really terrible,” said Fink. “There is something going on.”

The U.S. economy in the first quarter grew at a 0.7 percent annual rate, its weakest pace in three years, as consumer spending barely increased and businesses invested less to build up inventories.

Fink said it remains to be seen whether the GDP figure is an anomaly or reflects a true decline in momentum.

Fink, whose firm has $5.4 trillion in assets under management, has sounded a dour note on U.S. economic prospects this year despite strength in the stock market as U.S. President Donald Trump has taken office and promised a growth agenda.

In February, for instance, Fink said he saw “dark shadows” in the economy given uncertainty over trade policy and the restructuring of U.S. tax policy.

Trump unveiled a tax overhaul proposal on Wednesday that would slash the corporate tax rate and cut the top personal income tax rate. Critics say the proposal would cause the federal deficit to balloon, something that Trump denies.

“If this proposal is increasing deficits more, then I think we have a severe issue for our future,” particularly if economic growth does not move higher, Fink said.

Fink is among several business executives whose advice Trump has sought since taking office.

Reporting by Trevor Hunnicutt; Editing by Leslie Adler