Updated March 12th, 2024 at 09:45 IST

JPMorgan CEO urges Fed caution on interest rate cuts, warns of economic risks

Dimon stressed the importance of maintaining the central bank's credibility in inflation management.

Reported by: Business Desk
JPMorgan CEO | Image:LinkedIn
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JPMorgan CEO on rate cuts: During the Australian Financial Review business summit, JPMorgan Chase CEO Jamie Dimon advised the Federal Reserve to exercise patience before considering interest rate cuts, suggesting waiting until after June to make any decisions. 

Dimon stressed the importance of maintaining the central bank's credibility in inflation management.

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Expressing optimism about the robustness of the US economy, Dimon cautioned against overly optimistic views, suggesting a 65 per cent likelihood of a recession and not ruling out the possibility of stagflation. 

He highlighted concerns about the potential risks associated with the notable surge in debt and equity markets since late 2023, which he attributed partly to lingering effects of pandemic-era fiscal and monetary stimulus.

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Dimon also reiterated his scepticism about bitcoin, citing concerns about its association with illegal activities. 

Despite this, he defended individuals' rights to engage in transactions involving the cryptocurrency.

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Regarding artificial intelligence, Dimon shared insights into JPMorgan's extensive use of the technology, with thousands of employees working on various applications within the bank. 

He also mentioned using AI personally to summarise books he doesn't have time to read.

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Commenting on the upcoming US presidential election, Dimon predicted a tumultuous campaign and expressed concerns about the potential impact of geopolitical tensions on global growth, including conflicts in Ukraine and Gaza. 

He expressed hope for more thoughtful foreign policy rhetoric from presidential candidates, particularly regarding handling geopolitical challenges.

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Dimon's remarks underscore the complex economic and geopolitical landscape facing the United States and the broader global economy, urging caution and thoughtful policymaking in the face of uncertainty.

(With Reuters Inputs)

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Published March 12th, 2024 at 09:45 IST