JPMorgan Chase CEO Jamie Dimon cautioned that persistent inflation could prevent the Federal Reserve from implementing further interest rate cuts in 2025, contradicting market expectations for aggressive monetary easing. Speaking at the JP Morgan India Investor Conference, Dimon expressed skepticism about the Fed's ability to cut rates significantly while inflation remains "stuck at 3%" rather than the central bank's 2% target.
Dimon cited multiple inflationary pressures, including global fiscal deficits, potential world remilitarization, trade restructuring, and reduced immigration to the United States, which could sustain wage and price increases. His views align with Fed officials like St. Louis Fed President Alberto Musalem, who stated there is "limited room for easing further," and Atlanta Fed President Raphael Bostic, who suggested the September cut may be the only reduction needed this year. The Fed cut rates by 25 basis points to 4.00%-4.25% in September, but internal divisions emerged, with new Governor Stephen Miran advocating for cuts totaling 1.25 percentage points, while others warned against overly accommodative policy.
On cryptocurrencies, Dimon dismissed banking industry concerns about stablecoins threatening traditional deposit bases, calling blockchain technology "real" and distinguishing legitimate applications from speculative trading. This measured stance contrasts with other bank executives who warn of deposit flight similar to the 1980s money market fund crisis. The stablecoin market has grown from $4 billion in 2020 to over $285 billion today, with projections reaching $1 trillion in annual payment volume by 2030. Coinbase and other platforms offer yields up to 5%, compared to average U.S. savings account yields of 0.6%, and corporations like Amazon and Walmart are considering integration for cost efficiency. Dimon revealed JPMorgan is involved in stablecoin-related activities and considering a consortium for custody services.