JP Morgan chief issues recession and stagflation warning over Trump tariffs
JP Morgan chairman and chief executive Jamie Dimon has warned that severe curbs on trade imposed by President Donald Trump could lead the US economy towards recession and stagflation.
Dimon made the comments ahead of the multinational investment bank’s financial results, reporting revenue of $180.6bn and net income of $58.5bn in 2024.
He credited the bank with playing “a forceful and essential role in advancing economic growth.”
Writing in the banking giant’s annual report, Dimon said: “The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession.
“And even with the recent decline in market values, prices remain relatively high. These significant and somewhat unprecedented forces cause us to remain very cautious.”
Elaborating on the risk of recession, Dimon said: “Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth.”
“There are many uncertainties surrounding the new tariff policy: the potential retaliatory actions, including on services, by other countries, the effect on confidence, the impact on investments and capital flows, the effect on corporate profits and the possible effect on the U.S. dollar.”
He described JP Morgan Chase as “a company that historically has worked across borders and boundaries.”
A public rift
The banking chief added that the “long-term health of America, domestically, and the future of the free and democratic world” is “foundational” to the health of the investment bank.
This public rift over tariffs is striking, given that Trump reportedly took informal advice from Dimon after the election as he prepared to return to the White House – using the JPMorgan boss as a “sounding board” for economic policy.
Dimon stayed neutral during the US presidential election, and there had been speculation in 2024 that either Trump or his then-opponent Kamala Harris could appoint him to their respective cabinets.
Billionaire investor Bill Ackman made a similarly public intervention on Sunday, declaring that Trump’s trade policy risks an “economic nuclear winter.”
Ackman endorsed Trump in July after the assassination attempt on the now-US President.