Bloomberg – Jamie Dimon said he would not rule out the possibility of a recession in the United States, but that The Fed should wait before cutting interest rates.
“The world is expecting a soft landing, perhaps 70-80%,” the chief executive of JPMorgan Chase & Co (JPM) said via video link at the Australian Financial Audit Business Summit in Sydney on Tuesday. “I think the chance of a soft landing in the next year or two is half. The worst-case scenario is stagflation.
Dimon said economic indicators were distorted by Covid-19 and was taking them with a “grain of salt,” saying the Fed should wait for more clarity before cutting interest rates.
“They can always make cuts quickly and dramatically. “Their credibility is on the line a little bit here,” he added. “Unemployment in the United States is very low right now, and wages are continuing to rise.”
Dimon said that while the US economy is “fairly buoyant” at the moment, the risk of a recession remains.
Comments have A slightly less optimistic tone from the senior bankers, who recently painted an optimistic view of global markets, a marked departure from his views less than two years ago, when central banks began tightening interest rates. Dimon made headlines for warning in 2022 that a “hurricane” was about to hit the US economy.
Federal Reserve Chairman Jerome Powell suggested last week that the central bank is approaching the confidence it needs to start cutting interest rates.
“Hopefully we will have more confidence that inflation is moving sustainably at 2%,” Powell said Thursday while answering questions from the Senate Banking Committee. “When we have that confidence – and we are not far from it – it will be appropriate to start lowering the level of restrictions.”
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