Supporting women leaders and aspirants to unleash their potentialRead more Fake medicines kill almost 500,000 sub-Saharan Africans a year: United Nations Office on Drugs and Crime (UNODC) reportRead more Climate crisis and migration: Greta Thunberg supports International Organization for Migration (IOM) over ‘life and death’ issueRead more United Nations (UN) Convenes Lake Chad Countries, Amid Growing Regional CrisisRead more 11 Disruptive Startups Selected for Cohort 3 of the Africa Startup Initiative Program (ASIP) Accelerator Program powered by Startupbootcamp AfricaRead more Africa Data Centres breaks ground on new Sameer facility in NairobiRead more Coffee with a human face: A union that improves livelihoods for Ugandan farmersRead more Trends Predicted to drive the retail industry in 2023Read more Vantage Capital exits Pétro IvoireRead more Afrobarometer charts path for Round 10 surveysRead more

High inflation may derail US economy into recession: JPMorgan CEO

show caption
AFP Photo
Print Friendly and PDF

Dec 07, 2022 - 08:11 AM

ISTANBUL (AA) – JPMorgan Chase CEO Jamie Dimon said Tuesday that record inflation may derail the US economy and cause a recession in 2023.

Dimon said American consumers have saved $1.5 trillion from stimulus programs during the coronavirus pandemic but they are now spending 10% compared to 2021 because of higher inflation.

“Inflation is eroding everything I just said, and that trillion and a half dollars will run out sometime mid-year next year,” Dimon told US network CNBC’s Squawk Box.

The 66-year-old veteran CEO stressed that the US Federal Reserve’s aggressive monetary tightening cycle is causing its benchmark interest rate to climb toward 5% and even that level “may not be sufficient” to overcome inflation.

“When you’re looking out forward, those things may very well derail the economy and cause a mild or hard recession that people worry about,” he said.

The Fed raised interest rates by 75 basis points Nov. 2 for a fourth consecutive time, raising the target range for the federal funds rate to between 3.75% and 4% — its highest since January 2008.

The aggressive rate hikes have caused annual consumer inflation to come in at 7.7% in October, easing from the 8.2% gain in September. Annual producer inflation rose 8% in October, slowing from September’s 8.4% gain year-on-year.

MAORANDCITIES.COM uses both Facebook and Disqus comment systems to make it easier for you to contribute. We encourage all readers to share their views on our articles and blog posts. All comments should be relevant to the topic. By posting, you agree to our Privacy Policy. We are committed to maintaining a lively but civil forum for discussion, so we ask you to avoid personal attacks, name-calling, foul language or other inappropriate behavior. Please keep your comments relevant and respectful. By leaving the ‘Post to Facebook’ box selected – when using Facebook comment system – your comment will be published to your Facebook profile in addition to the space below. If you encounter a comment that is abusive, click the “X” in the upper right corner of the Facebook comment box to report spam or abuse. You can also email us.