Jamie Dimon is skeptical about a soft landing after the interest rate cut

“I'm a little more skeptical than other people. I think the chances of that happening are slim,” he said Friday at the Atlantic Festival event in Washington. “I hope it's true, but I'm also more skeptical that inflation will just disappear. Not because it hasn't gone down – it has gone down – and it can go down even further.”

The interest rate cut will have almost no impact on the presidential election, added the CEO of the largest US bank when asked whether there would be any impact at all.

The Federal Reserve cut its key interest rate by half a percentage point on Wednesday. The aim was a soft landing. Before the decision, Dimon said that a cut of 25 or 50 basis points would not have “earth-shattering” consequences.

The longtime CEO has been warning for more than a year that inflation could be more stubborn than investors expect, citing deficit spending and the “remilitarization of the world” as reasons, among others. In his annual shareholder letter in April, he wrote that JPMorgan was prepared for interest rates between 2% and 8% or more.

“I would have no illusions,” Dimon said, about the outcome of a soft landing. “Maybe we went from a lower interest rate and lower inflation to a slightly higher interest rate and higher inflation. Whatever it is, we'll deal with it. Economists are used to dealing with it. It's not a disaster.”