JPMorgan Forecasts Rising Interest Income Despite Economic Uncertainty

Core Viewpoint - JPMorgan Chase indicates that both businesses and consumers are demonstrating resilience amid economic uncertainty, projecting an increase in net interest income for the year [1]. Group 1: Financial Projections - JPMorgan's Chief Financial Officer, Jeremy Barnum, stated that net interest income could rise by $1 billion this year, although the full-year projection of$94.5 billion remains unchanged for now [2]. - The bank anticipates a net charge-off rate for credit card debt to be between 3.6% and 3.9% for 2026, consistent with the expected 3.6% rate for the current year [3]. Group 2: Consumer and Business Sentiment - Marianne Lake, CEO of consumer and community banking, noted that while consumers and small businesses are financially healthy, consumer confidence and small business sentiment have deteriorated [4]. - Recent data from the University of Michigan shows consumer sentiment has dropped to 50.2, down from 52.2 in April, marking one of the lowest levels recorded [5]. Group 3: Impact of Tariffs and Inflation - The evolving tariff environment and geopolitical tensions contribute to significant economic uncertainty, with inflation and fiscal deficits potentially limiting policy responses [3]. - Research indicates that 45% of consumer purchases are from imported goods, making the impact of tariffs particularly pronounced, with 60% of consumers expecting price increases and half of that group concerned about a recession [6][7].