Despite global uncertainties, Powell said US equities have shown strong performance. He attributed the recent gains to the impact of artificial intelligence (AI), which he described as a strong force supporting the market despite geopolitical risks.
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Powell acknowledged the weakening dollar and rising concerns about overexposure to one region, saying, “Having all your eggs in one basket, even a beautiful basket like the US, feels a bit riskier.” As a result, BlackRock is looking to selectively diversify into other geographies, especially within emerging markets.Discussing the broader environment, Powell said the investment landscape today is far more complex than it was a decade ago, due to persistent geopolitical risks such as the Russia-Ukraine war. He warned that waiting for complete clarity before investing may not be realistic, stating, “We are just going to have to learn to live with this kind of backdrop.”
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On global trade, Powell pointed to rising tariffs as a sign of long-term structural change. Even long-standing allies like the UK have faced 10% tariffs, which Powell called a potential “best case” for future trade deals. This, he explained, could mean structurally higher inflation. “We are deliberately injecting less efficiency into the trading system for political reasons,” he said, highlighting a shift from economic optimisation towards strategic alliances.
For the full interview, watch the accompanying video
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