JPMorgan CEO: Fed rate cut won't be 'earth-shattering'

JPMorgan Chase CEO Jamie Dimon said whether the Fed cuts rates by 25 basis points or 50 basis points, the move "would not be earth-shattering."

"They need to do it. But the Fed's rate hikes and rate cuts are small matters because there's a real economy underneath them," Dimon said at a conference on Tuesday.

Federal Reserve officials are expected to cut interest rates this week for the first time in more than four years. Ahead of the decision, bond traders were divided over whether the Fed would cut rates by 50 basis points or 25 basis points as the central bank continues to pursue a soft landing.

Dimon said last month that he "doesn't think it's as big of a deal as others think," citing economic uncertainty and lingering inflationary pressures.

He has warned for more than a year that inflation could be worse than investors expect, and wrote in his annual letter to shareholders in April that his company is prepared for interest rates to be in the 2% to 8% range or higher.

On Tuesday, at the annual Financial Markets Quality Conference at the Psaros Center for Financial Markets and Policy at Georgetown University, Dimon again said that geopolitical issues - including the Russia-Ukraine conflict, the Middle East wars and relations between the great powers - are his biggest concerns.

"It dwarfs any other issue I've encountered in my job," he said.

"People are overly focused on whether we will have a soft landing or a hard landing?" Dimon said. "Honestly, most of us have experienced these things, so it doesn't matter that much."

Bank of America's regular survey of fund managers this week showed that only 11% of investors believe the U.S. economy will have a hard landing. 79% of investors still expect a mild slowdown. The interest rate market once again showed its excitement. Therefore, the immediate challenge facing the market focuses on Powell's communication skills, which will be severely tested in the back and forth of the post-meeting press conference in the early hours of Thursday.

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