Jamie Dimon: ‘Take a deep breath’: Jamie Dimon warns Trump’s tariffs could trigger US recession

File photograph: JPMorgan Chase CEO Jamie Dimon (Picture credit score: AP)

JPMorgan Chase CEO Jamie Dimon on Wednesday warned that sweeping tariffs imposed by US President Donald Trump could push the US financial system into a recession and unleash monetary instability, as markets reel from the escalating commerce warfare with China.
According to Fox Business, Dimon mentioned, “I think probably a recession is a likely outcome,” including that latest steep market declines are deepening fears. “When you see a 2,000-point decline in the Dow, it sort of feeds on itself… it makes you feel like you’re losing money in your 401(k), you’re losing money in your pension. You’ve got to cut back,” he mentioned.
His feedback come as China introduced an 84% tariff on all US items, up 50 proportion factors from earlier ranges, in retaliation for Trump’s newest wave of import duties. The commerce tensions have despatched shockwaves by monetary markets, with Dow futures plunging over 800 factors and Treasury yields leaping 20 foundation factors.
Dimon acknowledged that the tariffs are creating “somewhat explosive” circumstances and urged the White House to speed up commerce negotiations. “Take a deep breath, negotiate some trade deals. That’s the best thing they can do,” he mentioned, whereas cautioning that the state of affairs “could get worse if we don’t make some progress here.”
JPMorgan economists now anticipate the US financial system to shrink by 0.3% in 2025, predicting a delicate recession following years of regular progress. According to Dimon, the market downturn is pricing in “uncertainty at the macro level and uncertainty at the company level,” which is affecting client sentiment and enterprise exercise.
Dimon’s issues additionally lengthen to the lending sector. He warned that rising rates of interest, sticky inflation, and widening credit score spreads would result in extra defaults. “I think you’ll see more credit problems,” he mentioned, including that IPOs are being canceled and a few bond offers are collapsing amid the volatility.
“The bad part of these volatile markets is… what it does to the capital markets and the ability of companies to raise money,” he defined. “We’ve lost a couple of bond deals already. They simply say that, you know, we’d rather just do this with a local bank than with a US bank”, he added.
Despite as soon as defending tariffs, telling CNBC in January that “a little inflation would be worth it to preserve national security”, Dimon’s tone has now shifted. In his annual letter earlier this week, he wrote that the financial system is dealing with “considerable turbulence” and warned that the long-term influence of tariffs could be damaging.
While Dimon stays one among company America’s most influential voices, along with his identify floated for senior financial roles throughout the 2024 marketing campaign, he stayed on at JPMorgan. On Wednesday, he additionally threw his assist behind Fed governor Michelle Bowman’s nomination as vice chair for supervision, urging the Senate to substantiate her.