Jamie Dimon: Fed May be Forced to Take Drastic Policy Actions Next Year
JPMorgan Chase CEO Jamie Dimon warned that even if the market’s concerns about inflation and interest rates have been eased as much as possible, the Fed may still be forced to adopt drastic policies next year action.
The Fed will release more details on the reduction of debt purchases at the September interest rate meeting on Thursday (23rd), and announce inflation and interest rate expectations. Chairman Jerome Powell has hinted that the central bank may start the reduction of purchases later this year.
“If inflation is so high that it forces the Fed to withdraw its liquidity urgently, the market will react drastically.” Dimon believes that the Fed may take action at some point next year.
“Feds can’t always be preemptive, and sometimes they face situations where they must respond passively.” Dimon said.
Data shows that the consumer price index (CPI) in the United States increased by 5.3% annually in August, a slight decline since the 13-year high set in July.
Bauer has repeatedly reiterated that the surge in inflation is only a temporary situation, but Dimon believes that part of inflation is indeed temporary, and part of it is not. Once high inflation continues to the end of the year, policymakers may have to accept some price increases.
Dimon said that this situation has been going on for a long time, so he does not think that by the end of the year, people will continue to think that inflation is only a temporary situation. However, if you are in a high-inflation environment, global economic growth will remain healthy, and worries may be eased.