U.S. Bank CEOs See Fed Staying the Course After Market Chaos

(Bloomberg) — Full coverage at bloomberg.com/davos, on Twitter @business and via our special WhatsApp alerts.

Leaders of the biggest U.S. banks don’t see 2018’s wild ending as reason enough for the Federal Reserve to reverse course.

“Some people in the market are predicting a rate cut this year, but I don’t see that happening,” Morgan Stanley (NYSE:) Chief Executive Officer James Gorman said in a Bloomberg Television interview in Davos, Switzerland. “But I certainly don’t see three or four increases. My personal projection is it will be one or two.”

The year ended chaotically for markets after a 2018 that saw the Fed increase rates four times, and many investors have scaled back their expectations for hikes in 2019 amid signs of slowing global growth. Lending margins have benefited from higher interest rates, but fears abound that tightening too quickly may strangle expansion.

“Right now, the data in December’s strong enough for another rate rise,” Bank of America Corp (NYSE:).’s CEO Brian Moynihan told Bloomberg Television on Wednesday.

Political factors like Brexit and the government shutdown in the U.S. have increased the uncertainty.

“The Fed will look at what’s going on, and my guess is they will probably pause now,” JPMorgan Chase & Co (NYSE:). CEO Jamie Dimon told CNBC in an interview Wednesday. “But if they raise rates again in six months because we’re growing at 2.5 percent, that’s still a good thing.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.