Top Wall Street Banker Warns Against Inflation Complacency

by Meir Sternhill

One of the financial world's most prominent figures is warning the White House not to declare victory in the battle against inflation, saying that a month's good showing can easily be undone.

Jamie Dimon, the CEO of JPMorgan Chase, the United States' largest bank, said that while December's temperature gauge of cost of living increases was 6.5 percent, well below the above 8 percent it was for much of 2022, it is still too high. This is especially worrying due to January's low unemployment rates, which usually comes along with higher inflation.

"People should take a deep breath on this one before they declare victory because a month’s number looked good," Dimon told Reuters. "It’s perfectly reasonable for the Fed to go to 5 percent and wait a while."

However, he added, if inflation comes down to 3.5 percent and stays there, not decreasing further, "you may have to go higher than 5 percent (interest rates) and that could affect short rates, longer rates," he said.

The Federal Reserve will reveal January's inflation numbers this coming Tuesday.

photo credit: Flickr