Jamie Dimon Says Federal Reserve Should Have Raised Rates Sooner

(Bloomberg) -- Jamie Dimon said the Federal Reserve should have moved quicker to raise rates as inflation hits the world economy.

“We're a little late,” the JPMorgan Chase & Co. chief executive officer said in an interview Wednesday with Bloomberg Television in London. “The sooner they move the better.”

The U.S. economy is “very strong,” he said, although there was a one third chance of the Fed's actions leading to a soft landing and a one third chance of a mild recession.

Federal Reserve Chair Jerome Powell is poised to unleash the U.S. central bank's most aggressive action to battle inflation in decades. The Federal Open Market Committee is expected to raise interest rates by a half point at the conclusion of its two-day policy meeting on Wednesday, its largest hike since 2000, and also announce plans to reduce the size of its $8.9 trillion balance sheet. 

Read more about U.S. interest rates

A bigger risk to the global economy than monetary tightening is the war in Ukraine, Dimon said, noting the crisis could have years to run. 

He said sanctions against Russia were working as intended although they are only “a tool in the toolkit” and “not definitive. What's definitive is tanks.”

And Western governments should do everything they can to meet Europe's energy needs. He said he assumes Europe will go into a recession if the conflict worsens.

Global Energy

“Global energy is precarious,” he said. “If oil goes to $185 that's a huge problem for people and we should do everything we can today. We need to pump more oil and gas.”

He said the U.S. government should be more focused on national security, including its energy and food resources.

“The Cold War is back,” said Dimon, who was speaking from the bank's 2022 CEO Forum. “National security is always the most important thing.”

Dimon declined to comment on reports that the Supreme Court is poised to overturn landmark abortion rights in the U.S. but said the lender would “take care of its people.”

In the wide-ranging interview, the Wall Street executive also said:

• China “cannot possibly like” the situation its ally Russia has put Beijing in;
• U.S. should sit down with China for negotiations over trade and intellectual property rights.

©2022 Bloomberg L.P.