JPMorgan chief executive Jamie Dimon says he expects the U.S. economy to expand at a rate of 2 percent next year, though if trade tensions with China persist or erupt further with the European Union that could create a “self-inflicted wound.”
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His GDP outlook of 2 percent for the U.S. is in line with the Federal Reserve’s forecast for next year which was discussed at their final meeting of 2019 which yielded no rate hike and a forecast of no hikes in 2020.
It is also following the 2.1 percent read in third-quarter GDP released in late November.
Speaking with reporters in Washington Wednesday at the Business Roundtable, Dimon, who is also the outgoing head, says the consumer is chugging along, but that China trade remains a negative.
Personally, Dimon thinks there will be a phase one deal, but that it will be difficult to negotiate a second deal after that. The BRT noted the group has no assurance from the administration tariffs will not go into effect Sunday because the administration itself doesn’t know.
“The president will decide the way he wants and we’ll find out when you do,” Dimon said. Though most executives expect tariffs slated to take effect mid-month to be put off.
CEOs from 140 of the largest companies in the U.S. expect sales to rise over the next six months, but plans for spending and hiring fell back. CEOs remain cautious in the face of uncertainty over trade policy and a slowdown in global growth and manufacturing, the BRT's fourth-quarter CEO outlook survey, which calibrates expectations for CEOs of the biggest firms’ outlooks for sales, spending and hiring over the next six months, found.
Nearly two-thirds of chief executives from the 140 companies surveyed in the U.S. expect sales to rise over the next six months while 51 percent don’t expect to change spending plans and 40 percent expect to increase hiring. When compared with expectations surveyed in the third quarter sales expectations rose, while spending and hiring plans fell back.
Still, CEO members of the BRT are projecting GDP will expand by 2.1 percent in the first quarter.
Dimon expects growth in emerging markets will speed up next year, China will meet its target of 5 to 6 percent GDP and overall global GDP will clock in around 3 percent.
Walmart CEO Doug McMillon will take the BRT helm from Dimon in 2020.