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Jamie Dimon, the chief govt of JPMorgan Chase, on Friday warned of an “unsettling” world panorama, highlighting a cascade of pressures, together with battle, rising geopolitical tensions and inflation, that threaten the economic system and will weigh on the efficiency of the nation’s largest financial institution.

Mr. Dimon’s remarks — made concurrently along with his financial institution’s quarterly earnings report, which confirmed weak point in some components of the enterprise — add to his litany of issues concerning the U.S. economic system because the Federal Reserve grapples with when or whether or not to decrease rates of interest, notably in gentle of this week’s hotter-than-expected inflation knowledge.

On a name with reporters on Friday, Mr. Dimon underlined his angst, describing heady monetary markets as “too completely happy.” He mentioned that he couldn’t predict whether or not the economic system would enter a recession, however that “the possibility of dangerous outcomes is increased than folks suppose.”

Mr. Dimon is essentially the most distinguished financial institution chief. Not solely does JPMorgan have publicity to all corners of the worldwide economic system, he’s the one main financial institution chief nonetheless round from the 2008 monetary disaster, and his pronouncements are intently adopted on Wall Road and in Washington. He was the one head of a giant American lender to attend this week’s White Home state dinner for Japan’s prime minister.

His gloom, nonetheless, has additionally been constantly at odds with robust monetary markets. In late 2022, as an example, he predicted financial bumps and, doubtlessly, a extreme recession for the following yr; as a substitute, the American economic system boomed in 2023.

Certainly, Citigroup’s chief monetary officer, Mark Mason, talking Friday as his personal financial institution reported earnings, had a comparatively rosy take. Mr. Mason described the worldwide economic system as “resilient” and mentioned that whereas Citi anticipated a slowdown in financial progress all year long, robust shopper spending and employment knowledge have been causes for optimism.

JPMorgan reported greater than $13 billion of revenue within the first quarter and almost $42 billion in income, each higher than analysts had anticipated. Nevertheless it mentioned there had been a drop in deposits as clients sought to speculate their cash slightly than depart it in checking and financial savings accounts, and it warned of upper bills sooner or later. JPMorgan additionally disclosed an unexpectedly steep fall in its so-called web curiosity earnings, a intently watched monetary metric that basically measures how a lot cash it is ready to make from lending.

Wells Fargo, the nation’s third-largest financial institution, on Friday individually reported earnings that additionally included a drop in that measure. It notched $4.6 billion in quarterly revenue, down 7 p.c from a yr earlier. The financial institution’s common deposits additionally fell, and the variety of new loans it made declined from final yr, partly due to its leaders’ strikes to scale back mortgage lending.

Shares of each banks have been decrease in early buying and selling Friday.

Many economists predicted that this yr would convey a so-called comfortable touchdown, or a mild easing in progress and inflation that will permit the Federal Reserve to decrease rates of interest in an orderly vogue.

Now, with little indication of any slowdown, it’s unclear whether or not the central financial institution will make the three rate of interest cuts that officers had predicted for the yr. Mr. Dimon has been among the many few financial institution leaders to say they’re getting ready for the likelihood that rates of interest might be raised once more, a transfer that will counsel extra excessive inflation than is at present being measured.

Mr. Dimon made extra prolonged remarks on the difficult setting in his annual letter to shareholders this week. He lamented, as he had earlier than, that the USA engaged in deficit spending and ticked off a listing of complaints about the place private and non-private leaders have fallen brief. (“Social media may do extra,” he wrote.) Referring to Russia’s invasion of Ukraine and different crises, he wrote that current occasions “could very effectively be creating dangers that might eclipse something since World Battle II.”

On Friday, he mentioned the subject on prime of his thoughts was “the way forward for the free world.”

Emily Flitter contributed reporting.

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