JPMorgan Chase CEO Jamie Dimon warned Monday that inflation could shape up to be a “skunk in a party” following the US and Israeli air strikes on Iran over the weekend.
Following the outbreak of conflict, in which Iranian Supreme Leader Ayatollah Ali Khamenei was killed, oil prices surged over fears of supply constraints and Wall Street’s volatility index jumped to its highest level so far this year.
“There’s some risk there’s more inflation than people think, and that could be like a skunk at a party if that ever happens,” Dimon told CNBC during an interview at his firm’s annual conference in Miami. “Hopefully it doesn’t happen.”
Inflation slowed to 2.4% in January, its tamest pace since last May, according to the most recently available Consumer Price Index – but wholesale inflation rose 2.9%, much hotter than expected and far above the Fed’s 2% goal.
The attacks on Iran – which President Trump warned could last “four weeks or so” – and their potential impact on gas prices have reignited concerns around sticky inflation.
“This right now will increase gas prices a little bit, and again, if it’s not prolonged there’s not going to be a major inflationary hit,” Dimon said.
“If it went on for a long time, that would be different.”
Dimon appeared to show support for the strikes in Iran, emphasizing the importance of peace in the Middle East – though he warned the conflict could lead to a rise in cyber and terrorist attacks globally.
“The most important thing is that we keep the Western world free and safe for democracy. And people like this have gotten away literally with murder for 50 years, that’s far more important,” Dimon said.
“But … as a corollary to that, you’ve got to expect there’ll be cyberattacks or terrorist attacks, either here or around the world. Banks may be targets,” he added.
The exec also weighed in on the president’s $5 billion lawsuit against JPMorgan, accusing the institution of “debanking” him after the Jan. 6, 2021 attack on the US Capitol.
The suit claims JPMorgan abruptly closed multiple accounts tied to the president in early 2021 for political reasons after a decades-long relationship.
Dimon said he was “sympathetic” to the president’s concerns, saying that he doesn’t “like debanking,” either – but added that it is necessary for banks to minimize legal and regulatory risks.
While JPMorgan has admitted to debanking Trump, it has denied accusations that it shuttered his accounts for political reasons.
“Reputation is a funny word, and so is political, because you could say, well, the Nazi Party, well, we probably would debank you. But we don’t do it generally for political or religious reasons,” Dimon said.
“I respect the president’s right to sue the company. We respect our right to defend ourselves,” he added. “The case has no merits.”
The bank executive also addressed the potential impact of artificial intelligence on the global workforce, after Twitter co-founder Jack Dorsey laid off thousands at his fintech company Block in a shift toward “intelligence tools.”
Dimon acknowledged the spread of AI will likely impact workers, though he said JPMorgan plans to “redeploy” employees throughout the company “if they’re displaced.”
But he argued the new tech is “going to create a lot of great things, and I really mean it. Your kids may be working four days a week and their kids three days a week, living wonderful lives, living to 100.”
“A lot of cancer will be cured. Accident rates in cars will drop dramatically. So let’s just put it in the big picture,” he said.
