Warning from Wall Street’s kingpin… “Rates will rise if Trump interferes with the Fed”
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Summary
- JPMorgan CEO Jamie Dimon said he warned that Trump administration interference with the Fed could instead push interest rates higher.
- Dimon and CFO Jeremy Barnum said undermining central-bank independence could hurt the U.S. economic outlook and global economic stability.
- President Trump pushed back, criticizing Chair Powell for keeping interest rates too high and vowing to name a successor within weeks.
Jamie Dimon, CEO of JPMorgan, warned that “interest rates could rise if there is interference with the Fed,” commenting on the Donald Trump administration’s rhetoric targeting Jerome Powell, chair of the U.S. central bank (Fed).
Speaking to reporters after JPMorgan’s fourth-quarter earnings release on the 13th (local time), Dimon said of the U.S. Justice Department issuing a grand jury subpoena to the Fed that “everyone we know believes central-bank independence is important,” adding, “This is probably not a good idea.” He added that “political interference in the Fed is likely to lift inflation expectations and, over time, push interest rates higher, producing a counterproductive effect that leads to rate increases.” He also said, “As an individual, I have great respect for Powell.”
Jeremy Barnum, JPMorgan’s chief financial officer (CFO), also echoed Dimon’s warning, saying, “The bigger issue is that the outlook for the U.S. economy could be damaged, and frankly it could also hit global economic stability.”
President Trump pushed back immediately. Responding to Dimon’s remarks that it would undermine the Fed’s independence, he dismissed them, saying, “He’s wrong.”
Although concerns about removing Powell have been voiced across politics and business—including Treasury Secretary Scott Bessent, some Republican lawmakers, and former Fed chairs—President Trump has not backed down from his insistence that Powell should be fired.
Visiting a Ford Motor plant in Detroit, Michigan, that day, Trump criticized Powell, saying, “We have a bad Fed chair,” adding that he is “bad, especially because he kept rates too high.” He also vowed to announce Powell’s successor within the next few weeks.
Reporter Han Kyung-je
