US banks lower recession risk amid tariff uncertainty
Bank Executives Indicate Growing Client Decisions Amid Tariff Uncertainty
Strong Consumer Sentiment and Adaptation to Trade Policy Reversals
Recent earnings releases from JPMorgan Chase and Citigroup highlighted U.S. consumer resilience despite President Trump’s fluctuating tariff agenda. Executives noted a lower perceived recession risk compared with April’s reporting period and emphasized that clients are becoming less rattled by the president’s trade policy changes.
Client Confidence and Trade Policy Adjustments
- JPMorgan Chase CFO Jeremy Barnum stated that businesses have accepted the need to navigate tariff shifts and are “getting on with it.”
- Citigroup CFO Mark Mason observed that corporate confidence has improved, with businesses feeling “more comfortable with the uncertainty” than in recent months.
Financial Performance Highlights
JPMorgan Chase reported Q2 profits of $15 billion, a 17 % decline from the same quarter last year, with earnings per share rising to $4.96 versus the analysts’ forecast of $4.49.
- Revenues fell 11 % to $44.9 billion.
- Higher asset‑management and trading revenues offset increased technology costs.
- Investment banking activity gained momentum, leading to a 7 % net revenue increase.
Citigroup posted a 25 % rise in Q2 profits to $4.0 billion, and revenues climbed eight % to $21.7 billion, driven by stronger markets revenue and investment banking fees.
Strategic Outlook and Risk Management
JPMorgan CEO Jamie Dimon described a “soft landing” scenario for the global economy, noting that the firm is prepared for a wide range of potential outcomes. Dimon highlighted the positive impact of recently signed tax cuts and potential deregulation, while acknowledging ongoing risks from tariffs, geopolitical tensions, and high asset prices.
Market Reaction
Shares of JPMorgan were flat mid‑morning, while Citigroup’s stock advanced by 2.1 %.
