Morgan Stanley CEO James Gorman issued a warning: The market is "complacent" about Trump's tariff policy and may underestimate the risks
JPMorgan Chase CEO Jamie Dimon warned the market about complacency regarding Trump's tariff policy, believing it may underestimate the risks. He emphasized the importance of a trade agreement between the EU and the US, and pointed out that the EU faces challenges in competitiveness. Dimon also mentioned that the possibility of the Federal Reserve raising interest rates is higher than market expectations, despite pressure from the Trump administration to lower rates
The Zhitong Finance APP noted that JPMorgan Chase CEO Jamie Dimon warned that the market is complacent about U.S. President Donald Trump's proposed tariffs. He stated at an event in Dublin, "Unfortunately, I think the market is showing complacency regarding the tariff news."
Dimon emphasized the importance of reaching an agreement between the EU and the U.S., adding that "a framework for tariffs needs to be established."
His comments come as the EU seeks to reach a preliminary trade agreement with the U.S., which could allow the EU to lock in a 10% tariff rate after the August 1 deadline, enabling both sides to negotiate a permanent agreement.
Dimon noted that the EU is currently "facing huge issues" regarding competitiveness, which is related to the region's sluggish economic growth. Former Italian Prime Minister Mario Draghi outlined these issues in a report last year.
"The goal should be to make Europe stronger and to keep the U.S. and Europe united," he added. "It's all in Draghi's report. So when we talk about a capital markets union, basically everything should be a single market. That's hard to achieve."
In his broad comments, Dimon also expressed his belief that the Federal Reserve may raise interest rates—despite market expectations to the contrary. The Fed has not cut rates this year, as it is waiting due to expectations that inflation will strengthen further.
"I think the likelihood of an interest rate hike is higher than anyone expects," he stated. "If the market thinks there's a 20% chance of a rate hike, then I think it's 40% to 50%."
The Trump administration is putting immense pressure on Federal Reserve Chairman Jerome Powell to lower borrowing costs. "Lower the rates, Jerome—it's time!" Trump wrote on social media this week
