JPMorgan CEO Jamie Dimon highlighted two key risks to the U.S. economy on Wednesday.
The veteran banker described the economy as “resilient,” citing low unemployment and strong consumer spending.
‘Businesses are more optimistic about the economy and are encouraged by expectations of a more pro-growth agenda [under Donald Trump]he told investors during an earnings call.
But Dimon warned of challenges. He warned that inflation still risks remaining high, affecting household budgets and hitting businesses.
He also highlighted the continued dangers of geopolitical instability, calling the current environment “the most dangerous and complicated since World War II.”
His comments came on the same day that US stocks rose, marking the biggest daily gain since Trump’s election.
All three major indexes posted their biggest daily percentage gains in more than two months.
Lower-than-expected core inflation data from December and solid earnings from major US banks including JPMorgan fueled the rally.
America’s most famous banker warned that there are two major threats to the US economy
Dimon has previously warned of the knock-on effects of global conflicts and tensions on the US economy.
In October, he warned that global conditions “are treacherous and getting worse.”
“As always, we hope for the best, but are preparing the company for a wide range of scenarios,” Dimon said on Wednesday.
Later on Wednesday it was announced that Israel and Hamas had agreed to a ceasefire in Gaza after fifteen months of war.
The news, announced by mediator Qatar, has raised hopes for an end to the devastating conflict that has rocked the Middle East.
Dimon’s comments came as JPMorgan posted its biggest annual profit ever, beating Wall Street expectations.
The bank, the largest in the US by assets, earned $58.5 billion in 2024, including $14 billion in the last quarter, a 50 percent increase from the same period a year earlier.
Several other major U.S. banks also reported rising profits.
Israel and Hamas have agreed to a ceasefire and the release of hostages, mediators announced on Wednesday
Consumer prices rose 2.9 percent from a year earlier in December, slightly more than the previous month
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Profits for 2024 at Goldman Sachs rose 68 percent to £11.7 billion.
The investment bank’s quarterly profit of £3.4 billion was the biggest in more than three years.
Wells Fargo CEO Charlie Scharf said, “We’re optimistic about where we’re going in 2025.”
It revealed annual profits rose 3 percent to £16.1 billion.
Citi reported a profit of $2.9 billion in the fourth quarter, compared with a loss of $1.8 billion in the 2023 quarter.
On Wednesday morning it emerged that consumer prices were 2.9 percent higher than a year earlier in December. They posted the largest monthly increase in nine months.
But a key measure that excludes highly volatile commodities such as food and energy was down, pleasing Wall Street.
The inflation data released Wednesday by the Bureau of Labor Statistics is seen by some as the most important in years because it could provide an indication of the path the Federal Reserve may take in 2025.
This, in turn, will impact U.S. credit card rates, auto loans, 401(K) retirement accounts and mortgages.