Top Wall Street banker makes recession prediction
The US economy could plunge into recession in the next six to nine months, JPMorgan Chase CEO Jamie Dimon told CNBC this week.
According to Dimon, the economy is “actually still doing well,” though soaring inflation, higher-than-expected interest rate hikes, and the situation in Ukraine are a “very serious” combination that could lead to recession.
“You can’t talk about the economy without talking about stuff in the future – and this is serious stuff… These are very, very serious things which I think are likely to push the US and the world – I mean, Europe is already in recession – and they’re likely to put the US in some kind of recession six to nine months from now,” he said.
The US Federal Reserve raised interest rates by 75 basis points last month, the third consecutive increase of that amount. Officials also signaled that they could continue to hike the rates if the situation with consumer prices does not improve.
The JPMorgan Chase CEO said that the Fed “waited too long and did too little” to tackle inflation, which recently jumped to a 40-year high, though he noted that he is not criticizing the Fed’s current approach.
“From here, let’s all wish [the Fed] success and keep our fingers crossed that they manage to slow down the economy enough so that whatever it is, is mild – and it is possible.”
Dimon said he cannot predict how lengthy the recession might be.
“It can go from very mild to quite hard and a lot will be reliant on what happens with [the conflict in Ukraine]. So, I think to guess is hard; be prepared.”
He added that the only guaranteed outcome of the situation will be high market volatility.
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