Jamie Dimon warns world may not be ready for Fed rate rising to 7%

JPMorgan Chase & Co. CEO Jamie Dimon

The world may not be prepared for a worst-case scenario of Federal Reserve benchmark interest rates hitting 7% alongside stagflation, JPMorgan Chase & Co. CEO Jamie Dimon said in an interview with the Times of India.

Dimon added that the difference between 5% and 7% would be more painful for the economy than going from 3% to 5% was.

Market forecasts currently suggest that the Fed is nearing the end of its tightening cycle after interest rates reached 5.5%, the highest level in 22 years. However, US policymakers still believe that rates must remain high for a longer period to tame inflation.

Fed Chairman Jerome Powell explained that future interest decisions will depend on economic data, which recently indicated a slowdown in inflation and a calm labor market.