Leading US banks, including JPMorgan Chase and Citigroup, reported better-than-expected earnings on Tuesday, signalling a robust American economy and businesses’ increasing adaptability to ongoing tariff uncertainties.
Executives from both financial giants indicated that US consumers remain fundamentally healthy, and their outlook on a potential recession has become more optimistic since April.
JPMorgan Chase CFO Jeremy Barnum noted that corporations have largely “accepted that they just need to navigate through this” period of fluctuating trade policies.
Citigroup CFO Mark Mason echoed this sentiment, stating businesses have gained “comfort with the uncertainty” compared to recent months. Mason also highlighted a “significantly” reduced prospect of a recession in the second quarter.
JPMorgan and Citigroup’s Performance Highlights
JPMorgan Chase posted a second-quarter profit of $15 billion, a 17% decrease from the previous year, which had benefited from a one-time equity gain.
However, this translated to $4.96 per share, exceeding analyst projections of $4.49, driven by stronger performance in its operating divisions.
Revenue stood at $44.9 billion, down 11% year-over-year. The bank’s second-quarter success was buoyed by increased asset management fees and higher trading revenues amid market volatility, offsetting rising technology expenses.
JPMorgan CEO Jamie Dimon observed a slow start to investment banking activity in the quarter but a seven per cent gain as market sentiment improved.
Dimon praised recent tax cut extensions signed by President Trump as “positive” for the economic outlook, alongside “potential deregulation.”
Despite this, he cautioned about “significant risks,” including tariffs, geopolitical tensions, high fiscal deficits, and elevated asset prices, stating the firm prepares for various scenarios while hoping for the best.
Dimon clarified these were not predictions but cautious reflections on potential outcomes, adding that the market seems to be pricing in a “soft landing” for the economy.
Citigroup reported a 25% increase in profits year-over-year, reaching $4.0 billion, with revenues climbing 8% to $21.7 billion.
This growth was primarily fuelled by strong market revenue and investment banking fees.
Mason underscored an improved macroeconomic outlook since April, highlighting the “underlying strength” of the US private sector and capital markets.
He anticipates “further consumer cooling” in the second half of 2025 due to tariff effects, but affirmed the “quite resilient” global economic performance.
By mid-morning Tuesday, JPMorgan’s shares remained flat, while Citigroup saw a 2.1% increase.
