US: Dimon Says Trump Administration Should Re-Engage With China - FT Interview
Speaking in a wide-ranging interview with The Financial Times, JPMorgan Chase CEO Jamie Dimon has urged the Trump administration to re-engage with China. Dimon’s comments may carry additional weight as President Donald Trump acknowledged that Dimon's remarks influenced his decision to rein in his tariff agenda last week.
- Dimon: “I don't think we have any engagement right now, and so - but that can start tomorrow. So, it doesn't have to wait a year. It could start tomorrow. You start with a phone call.”
- Dimon also urged the Trump administration to bolster its alliances to better address China: “I would want to negotiate eventually with Europe, with the UK, with Japan, Korea, Australia, Philippines, and … then face off with China and say, we want to trade with you, but here are the terms of trade that we all think are fair and reasonable.”
- On Treasury markets: “…there clearly was hedge fund deleveraging, which caused some of this. I think the real issue is, there's ongoing uncertainty around tariffs…”
- On Treasury Secretary Scott Bessent: “I think he's an adult… I think he's the guy who should probably be negotiating these trade agreements.”
- Bloomberg notes that ahead of his tariff reversal, Dimon piqued Trump's interest, "particularly when he said it was “perfectly reasonable” to conclude that global trade was unfair. Dimon encouraged foreign policymakers to take a calm approach and “negotiate some trade deals.”"
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FED: March Economic Projections: Higher Inflation, Weaker Growth, Same Rates
The MNI Markets Team’s expectations for the updated Economic Projections in the March SEP are below.
- The unemployment rate is likely to rise slightly for 2025 alongside a downgrade in GDP growth, while the 2025 core and headline PCE inflation projections are set to rise again. Changes to later years will likely be limited, however.
- More detail on the shift in Fed funds rate medians is in our meeting preview - we will add more color next week.
FED: Market Pricing Nearly 3 2025 Cuts As Conditions Tighten
Amid rising government policy uncertainty, sentiment among businesses and consumers has fallen sharply since the start of the year, while equities and the dollar have reversed their post-election rise. Overall, financial conditions have tightened, even if stress is not yet mounting, e.g. no major widening of credit spreads (the accompanying chart shows the Fed’s financial conditions impulse index but only through January).
- Combined with growth fears, this has affected expectations for the Fed’s rate path, with around 18bp more cuts expected in 2025 compared with what was seen after the January FOMC. 65bp of cuts are priced for the year as a whole. 2025 cut pricing reached 71bp before the February inflation data and 76bp before the February payrolls report.
- A rate cut is seen with near zero probability for March’s meeting, but the first full cut is just about priced for June, with a second nearly priced by September.
- Chair Powell has no reason to endorse or refute these expectations – he’s likely to be happy with a press conference that ends with little discernable change in pricing.
CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
- CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
