April 10, 2025
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Think the worst is over for markets? JPMorgan’s Jamie Dimon still sees a US recession ahead despite Trump’s 90-day tariff pause
JPMorgan Holds the Line: Recession Still Likely, Despite Market Reprieve
Wall Street may have exhaled after President Trump paused most of his sweeping “reciprocal” tariffs, but JPMorgan Chase isn’t easing up on its recession warning. On Wednesday, the bank reaffirmed its 60% probability of a U.S. recession, even after a 90-day tariff reprieve—which notably excludes China.
The pause came after a turbulent week that saw the S&P 500 flirt with bear market territory, Treasuries sell off, and investor confidence shaken. But JPMorgan’s economists argue the fundamentals haven’t changed.
In a note obtained by Newsweek, the team called the China-specific tariffs “shocking,” noting the average U.S. tariff rate now stands around 25%, slightly above last week’s level, even with the pause.
“Ongoing policy chaos, deep equity losses, and fragile confidence make it hard to see the U.S. avoiding recession,” the report warned.
CEO Jamie Dimon, speaking to Fox Business, echoed the concern: “A recession is a likely outcome.” He pointed to weakening consumer sentiment, surging bond yields, and mounting Chinese retaliation. “That is kind of recessionary talk,” Dimon added.
He also flagged rising credit risks: “Rates are up, inflation is sticky, and spreads are widening—we’re going to see more credit problems than we’ve seen in a long time.”
Dimon’s prescription: fix the trade mess fast. “Resolving tariffs and trade disputes is critical,” he said, adding, “If there is a recession, hopefully it’ll be short.”
In contrast, Goldman Sachs has lowered its recession forecast to 45%, citing the temporary policy relief—but many analysts remain cautious.
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