J.P. Morgan Chase CEO Jamie Dimon warned of “a lot of underlying inflation” Thursday during a CNBC interview at the World Economic Forum.
CNBC’s “Squawk Box” asked Dimon about the future of the economy and what he believes Federal Reserve Chair Jerome Powell will do next. Dimon noted that economic forecasters, including the Fed, were wrong about inflation.
Jamie Dimon believes that rates will rise above what the Fed projects as inflation persists.
“I actually think rates are probably going to go higher than 5% … because I think there’s a lot of underlying inflation, which won’t go away so quick.”https://t.co/zqNXL18lpG
— Yun Li (@YunLi626) January 19, 2023
“I actually think rates are probably going to go higher than 5% … because I think there’s a lot of underlying inflation, which won’t go away so quick,” Dimon said, according to the outlet. The Federal Reserve raised interest rates to a range between 4.25% and 4.50% in December, the highest level in 15 years, CNBC reported.
J.P. Morgan Chase is expecting a “mild recession” and set aside $1 billion in cash in preparation for more borrowers to fall behind on their loans, according to The New York Times. The bank’s fourth quarter earnings were $11 billion, a 6% increase year over year, the Times added.
The Federal Reserve believes it has more room to raise interest rates despite fears of a recession voiced by J.P.Morgan and other large banks, Powell said Dec. 14, Reuters reported. (RELATED: Wholesale Prices Drop Below Expectations, But Food Costs Skyrocket)
“I know there are going to be recessions, ups and downs. I really don’t spend that much time worrying about it. I do worry that poor public policy damages American growth,” Dimon continued.
The World Economic Forum is an annual gathering of global leaders in politics, business and philanthropy. This year’s gathering is being held from Jan. 16-20 in Davos, Switzerland. J.P. Morgan is listed as one of the event’s partners.