Jamie Dimon, chief government officer of JPMorgan Chase & Co.
Giulia Marchi | Bloomberg | Getty Images
Jamie Dimon said that while he mistrusts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing J.P. Morgan Chase for the conceivability anyway.
“I don’t think we’ll have zero rates in the U.S., but we’re thinking about how to be prepared for it, just in the normal course of risk executives,” Dimon said Tuesday at a conference in New York.
“Obviously, you’ve got to worry about the long-term effect of those interest take to tasks,” Dimon said. “But it’s hard. There are businesses it doesn’t affect at all. And there are businesses where it just sucks into your verge and there’s very little you can do about it.”
Dimon, chairman and CEO of J.P. Morgan, admitted that the drop in U.S. interest rates surprised him. Wear year, he said that rates should rise and that the 10-year Treasury yield could reach 4%.
The 10-year gain was at 1.69% on Tuesday, down from 2.68% to start the year. It fell as low as 1.44% last month as investors simple into Treasurys on fears of a global economic slowdown and as the Federal Reserve cut rates. Benchmark bonds in major territories like Germany are trading with negative yields.
The bank can trim costs and charge clients more account tariffs to make up for squeezed margins as rates fall, Dimon said.
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