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March 29, 2024
Egypt Bulletin
Business

CEO of JPMorgan says it is too soon to declare victory over inflation

JPMorgan Chase & Co.‘s CEO Jamie Dimon cautioned against declaring victory too soon against inflation, warning the Federal Reserve might raise interest rates above 5% if prices remain “sticky.” Several Federal Reserve officials said more rate increases were on the way, though none was ready to suggest January’s strong jobs report could push them back to more aggressive monetary policy, according to Reuters.

CEO of JPMorgan says it is too soon to declare victory over inflationAccording to Dimon, “people should take a deep breath before declaring victory just because a month’s number looks positive.” “I think it’s perfectly reasonable for the Fed to move to 5% and wait a while,” Dimon said. He said that if inflation drops to 3.5% or 4% and stays there, “you may have to raise rates above 5% and that could affect short- and long-term rates.”

In December, the Fed’s preferred measure of inflation stood at 5%, down from nearly 7% in June. In a wide-ranging interview with Reuters, Dimon warned that stricter regulation of credit card fees could result in lenders extending less credit. As part of his efforts to maintain relations with China, he also said he planned to visit the country.

Dimon warned that a default on U.S. debt would be potentially “catastrophic” unless the debt ceiling is raised. “We cannot have a default,” Dimon said. In his words, it could cause permanent damage to America and “could destroy its future.”

A joint session of Congress was addressed by President Joe Biden on Tuesday. In this address, he encouraged Republicans to raise the $31.4 trillion debt ceiling before the end of the year. Earlier this month, JPMorgan announced it plans to hire over 500 bankers to serve small businesses through 2024, increasing its workforce in this segment by 20%.

Despite cuts at other Wall Street banks, Dimon said JPMorgan’s hiring prospects remain positive. “In general, we are still opening branches around the world, hiring consumer bankers, small business bankers, middle market bankers, and people overseas… we have more clients to service,” he explained.

The biggest names on Wall Street, including Goldman Sachs Group Inc and Morgan Stanley, have cut thousands of jobs as the economy continues to deteriorate, and mortgage lenders have also cut their staffs in response.

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