JPMorgan Chase & Co’s CEO Jamie Dimon warned that the market should be prepared for rates going higher from here.
Speaking at JPMorgan’s investor day, the CEO noted that the current five percent of policy rate is not enough in Fed funds, adding that he has been advising this precaution to his clients and banks that they should be prepared for the interest rate to go as much as six or seven.
JPMorgain’s President and Chief Operating Officer Daniel Pinto said that even with the global and U.S. economies doing fine, there are signs of deterioration.
The Fed funds rate stands at 5-5.25% after a 25 basis point increase in May, while the market interpreted that the Fed could hold rates moving forward.
Minneapolis Federal Reserve President Neel Kashkari said that he is open to the central bank holding interest rates in June, but signalled that it is not an indication the hike cycle has ended.
Kashkari told CNBC that right now it’s a close call either way, versus raising another time in June or skipping.
According to the CME FedWatch Tool, the market is inclined to a pause for the meeting in June with the odds of 15.3% for a 25bps hike.