'Wall Street Emperor' Dimon: "Fed Losing Control Over Inflation... US Economy Solid"

[Asia Economy New York=Special Correspondent Joselgina] Jamie Dimon, CEO of JP Morgan Chase, known as the "Emperor of Wall Street," criticized the central bank, the Federal Reserve (Fed), for having partially lost control over inflation. He assessed that the U.S. economy is showing strength.

On the 23rd (local time), Dimon appeared on CNBC and said, "I respect Fed Chair Jerome Powell, but the fact is that we have partially lost control over inflation." He predicted that it will take considerable time for the Fed to achieve its 2% inflation target, which likely means interest rates will remain at higher levels.

[Image source=Reuters Yonhap News]

This statement came the day after the release of the minutes from the February Federal Open Market Committee (FOMC) meeting, which reaffirmed the Fed's tightening stance. The minutes noted that although there are signs that inflation is declining, it is not yet sufficient, and rate hikes should continue. It also included that while most participants at the February FOMC considered a 0.25 percentage point increase appropriate, a minority suggested a 0.5 percentage point hike.

Dimon gave a positive assessment of the recent U.S. economy. He said, "The current U.S. economy is doing quite well," adding, "Consumers have a lot of money, and they are spending it. Jobs are abundant." However, he also issued a warning. He said, "This is (the situation) today," and cautioned, "There are scary things ahead of us. We always know there is uncertainty. That is normal."

CNBC reported that Dimon's recent evaluation of the U.S. economy contrasts with his earlier remarks warning that the U.S. economy could enter a recession within 6 to 9 months. In December last year, Dimon also stated that higher inflation was eroding consumers' wealth, which could eventually lead to a recession this year.

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