On Tuesday, the global market was ignited with a festive atmosphere due to the latest release of better than expected US October CPI data. The US stock market opened high and rose, with the S&P 500 index posting its largest gain since April this year.
However, in a moment of excitement, JPMorgan Chase CEO Jamie Dimon stepped forward and poured cold water.
Is the US interest rate hike cycle coming to an end?
The latest released data shows that the potential price pressure in the United States seems to be weakening: in October, the US CPI remained unchanged month on month, with a year-on-year growth rate dropping to 3.2%. Core inflation, excluding food and energy prices, increased by 0.2% month on month, and the year-on-year growth rate slightly decreased to 4.0%.
Data shows that the Federal Reserve's measures to combat inflation seem to be working. Many Wall Street insiders believe that this data signifies the end of the US interest rate hike cycle.
We now believe that the interest rate hike cycle has come to an end, "said Stephen Juneau, an economist at Bank of America, in a report
Nick Timiraos, a renowned journalist known as the "New Federal Reserve News Agency," also wrote that the trend of slowing inflation in the United States continued into October, and the Federal Reserve may have completed its current interest rate hike cycle.
JPMorgan Chase Throws Cold Water
However, in an interview, J.P. Morgan CEO Damon stated that people have overreacted to short-term data and "they should stop doing so.
I'm worried that inflation won't disappear so quickly, "Dimon said. The Fed's temporary suspension of interest rate hikes is correct, but" they may need to do more
He stated that despite the current favorable situation, American consumers and businesses still face significant resistance, including quantitative tightening and geopolitical tensions.
For over a year, Damon has been concerned about inflation in the United States.
In September of this year, he also warned that JPMorgan Chase had informed clients that to prepare for a 7% interest rate environment, the Federal Reserve may have to further raise benchmark interest rates to combat inflation.