September 23, 2021

JPMorgan CEO Warns - Will The Fed Take Drastic Action?

 JPMorgan Chase CEO Jamie Dimon has warned investors that it is not impossible for the Fed to take drastic measures next year.

The Fed Chairman Jerome Powell has suggested that the central bank is likely to restart monetary stimulus before the end of the year. This matter is expected to be explained in more detail in The Fed’s 2 -day policy meeting. U.S. central bank will also publish inflation and interest rate forecasts that will be important indications for market players.

Dimon in a recent interview said that if the United States (U.S.) continues to record rising inflation in the next few months, the central bank is likely to act more quickly. In other words, such a high inflation reading is likely to elicit a greater reaction from the central bank.

The latest data shows U.S. consumer prices. up 5.3% year -on -year in August, down slightly from a 13 -year high of 5.4% for July.

So far Powell still holds the view that this price increase is only temporary in nature. On the other hand, Dimon said that if inflation figures continue to rise steadily until December then policymakers will most likely be of the view that price increases are no longer temporary.

So Dimon said ‘I’m a bit skeptical if in December with inflation rising, drafters will say this rise is only temporary’.

Market players are now focusing on the Fed meeting at 2 p.m.