JP Morgan: US economy will witness a soft landing

JP Morgan CEO Jamie Dimon said market expectations are so high that the US economy will see a soft landing.

Jamie Dimon believes there is a better chance that the United States will head toward a recession, although he does not see systemic problems on the horizon.

The head of the largest US bank by assets, speaking at the JPMorgan High Yield and Leverage Finance Conference in Miami, said markets may not be factoring in a strong enough possibility that interest rates will remain high for longer.

Dimon warned of several factors affecting the macroeconomy, including fiscal deficit spending and geopolitics, considering that they have a long-term impact, and that it is a mistake to reduce them to one year.

Dimon believes that rising interest rates and a recession could severely impact areas such as commercial real estate and regional banks, but with limited macroeconomic effects. However, Dimon said he does not expect a repeat of some of the other serious downturns the US economy has faced, such as the 2008 financial crisis that saw Wall Street collapse as banks were hit by the fallout from the collapse of the mortgage industry.