New Fed comment from JPMorgan CEO

JPMorgan Chase & Co. CEO Jamie Dimon said that the Fed may raise interest rates higher than expected at the moment, but would prefer a medium rate hike to see the full impact of last year’s increases.

In an interview with Fox Business, Dimon stated that there is a 50 percent chance that the Fed will raise the interest rate to about 5 percent, as expected, and a 50 percent probability that it will rise to 6 percent.

Dimon, the CEO of the largest bank in the USA, stated that 5% in interest rate may not be enough, and said, “We were a little slow to move forward in the interest rate increase. But I think it will not hurt to wait for 3 or 6 months.”

These messages from Dimon came ahead of the US inflation data to be released on Thursday. Fed officials slowed the rate of increase last month after increasing interest rates by 75 basis points for 4 times in a row and continued with an increase of 50 basis points, reducing the interest rate to the range of 4.25-4.5 percent.

Regarding the general outlook in the economy, Dimon said that the consumer is still strong, but the risks remain high.

While Goldman Sachs and Morgan Stanley are making layoffs, Dimon revealed that JPMorgan is continuing to recruit.

In their assessments on Monday, two officials of the US Federal Reserve stated that interest rates may need to be raised above 5 percent and then kept at one-to-one level for a period of time. Speaking at a panel, Atlanta Fed Leader Raphael Bostic said that the Fed is determined to reduce inflation and this will require increasing interest rates to the 5.25 percent band to eliminate excess demand in the economy.

San Francisco Fed Leader Mary Daly also mentioned that she thinks the policy rate, which is currently 4.25-4.50 percent, should go to 5.0-5.25 percent to bring inflation down and stay there.