Ahead of the Fed's 75 basis point rate hike, JPMorgan CEO Jamie Dimon told lawmakers they "should be prepared for the worst."
The Fed's third consecutive rate hike comes after the monthly inflation rate unexpectedly rose last month signaling that aggressive rate hikes will remain in place for longer than anticipated.
By raising rates, the central bank is aiming to slow consumer spending levels. But it hopes to stop short of causing a recession in the process or achieve what's known as a "soft landing."
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Dimon, who leads the nation's largest consumer bank, said there's only a "small chance" that will occur. Testifying before the House Financial Services Committee he warned that if there's an imminent recession it may not be a mild one because of economic uncertainty from the ongoing war in Ukraine. Dimon testified alongside the CEOs from Bancorp, PNC, Citigroup, Bank of America, Truist and Wells Fargo.
Asked by Rep. Bill Posey, R-Fla., if Congressional spending was responsible for the high level of inflation Dimon said, "I don't think you can spend $6 trillion and not expect inflation."
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However, he said he is not criticizing the actions lawmakers took to reignite the economy which was shuttered by the pandemic.
"I don't like to cry over spilled milk," he said. "Let's do the things we have to do to fix all that and then move forward and grow the economy which is the best way to reduce inflation and help all of our citizens."
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In June, Dimon startled markets when he told investors at a company conference to brace themselves for an economic "hurricane."
Dimon clarified that a hurricane-like economic situation isn't a given but a possibility, which is why he urged lawmakers to be prepared for the worst "so that we take the right actions if and when that happens."
Elisabeth Buchwald is a personal finance and markets correspondent for USA TODAY. You can follow her on Twitter @BuchElisabeth and sign up for our Daily Money newsletter here
This article originally appeared on USA TODAY: Jamie Dimon testimony in Congress: 'Be prepared for the worst'