Finance

JPMorgan, the world’s largest bank by market capitalization, is being “fundamentally rewired” for the AI era, according to chief data analytics officer Derek Waldron.
AI was a major topic at a four-day executive retreat held in July by JPMorgan CEO Jamie Dimon, according to a person who attended but declined to be identified speaking about the private event.
JPMorgan is now early in the next phase of its AI blueprint: It has begun deploying agentic AI to handle complex multistep tasks for employees, according to an internal roadmap.
Waldron, who gave CNBC the first demonstration of JPM’s AI platform seen by any outsider, showed the AI program creating an investment banking deck in 30 seconds.

Deep within the bowels of JPMorgan Chase’s data centers and cloud providers, an artificial intelligence program crucial to the bank’s aspirations grows more powerful by the week.
The program, called LLM Suite, is a portal created by the bank to harness large language models from the world’s leading AI startups. It currently uses models from OpenAI and Anthropic.

Every eight weeks, LLM Suite is updated as the bank feeds it more from the vast databases and software applications of its major businesses, giving the platform more abilities, Derek Waldron, JPMorgan chief analytics officer, told CNBC in an exclusive interview.
“The broad vision that we’re working towards is one where the JPMorgan Chase of the future is going to be a fully AI-connected enterprise,” Waldron said.
JPMorgan, the world’s largest bank by market capitalization, is being “fundamentally rewired” for the coming AI era, according to Waldron. The bank, a heavyweight across Main Street and Wall Street finance, wants to provide every employee with AI agents, automate every behind-the-scenes process and have every client experience curated with AI concierges.
If the effort succeeds, the project could have profound implications for the bank’s employees, customers and shareholders — even the nature of corporate labor itself.
Waldron, who gave CNBC the first demonstration of its AI platform seen by any outsider, showed the program creating an investment banking deck in about 30 seconds, work that would’ve previously taken a team of junior bankers hours to complete.

Out of the box

Since the arrival of OpenAI’s ChatGPT in late 2022, optimism over generative AI has driven markets higher on gains from the tech giants and chip makers closest to the trade. Underpinning their growth is the expectation that corporate clients deploying AI will either boost worker productivity or lower expenses through layoffs — or both.
But similar to how the internet story played out in the 1990s, near-term expectations for AI may have outstripped reality. Most corporations had no tangible returns yet on their AI projects despite more than $30 billion in collective investments, according to an MIT report from July.

Jamie Dimon, Chairman and Chief Executive Officer of JPMorgan Chase & Co. speaks during an event honoring local construction workers who helped build the firm’s new headquarters at 270 Park Avenue, in the Midtown area of New York City, U.S., Sept. 9, 2025.
Shannon Stapleton | Reuters

In the case of JPMorgan, even with it $18 billion annual tech budget, it will take years for the company to realize AI’s potential by stitching the cognitive power of AI models together with the bank’s proprietary data and software programs, said Waldron.
“There is a value gap between what the technology is capable of and the ability to fully capture that within an enterprise,” Waldron said.
Companies “do work in thousands of different applications, there’s a lot of work to connect those applications into an AI ecosystem and make them consumable,” he said.
If JPMorgan can beat other banks to the punch on incorporating AI, it will enjoy a period of higher margins before the rest of the industry catches up. That first-mover advantage will allow it to grow revenues faster by going after a larger slice of the addressable market in global finance — enabling the bank to pitch more middle-market companies in investment banking, for instance.

Change on the horizon

AI was a major topic at a four-day executive retreat held in July by JPMorgan CEO Jamie Dimon, according to a person who attended but declined to be identified speaking about the private event.
Among concerns discussed at the off-site meeting, held at a resort outside Nashville, was how AI-driven changes will be adopted by the bank’s 317,000-person workforce and its possible impacts to the apprenticeship model on areas including investment banking.
If JPMorgan succeeds with its AI goals, it will mean that a bank that is already the largest and most profitable in American history is set for new heights. Dimon has led the bank since 2005, guiding it through periods of upheaval to notch record profits in 7 of the last 10 years.
The end state for JPMorgan, as envisioned by Waldron, is a future in which AI is woven into the fabric of the company:
“Every employee will have their own personalized AI assistant; every process is powered by AI agents, and every client experience has an AI concierge,” he said.

JPMorgan laid the groundwork for this starting in 2023, when it gave employees access to OpenAI’s models through LLM Suite; it was essentially a corporate ChatGPT tool used to draft emails and summarize documents.
About 250,000 JPMorgan employees have access to the platform today, which is the entire workforce except for branch and call center staff, said Waldron. Half of them use it roughly every day, he said.
JPMorgan is now early in the next phase of its AI blueprint: It has begun deploying agentic AI to handle complex multistep tasks for employees, according to an internal roadmap provided by the bank.
“As those agents become increasingly powerful in terms of their AI capabilities and increasingly connected into JPMorgan,” Waldron said, “they can take on more and more responsibilities.”

Nvidia deck

Waldron, a former McKinsey partner with a Ph.D. in computational physics, recently demonstrated LLM Suite’s capabilities to CNBC.
He gave the program a prompt: “You are a technology banker at JPMorgan Chase preparing for a meeting with the CEO and CFO of Nvidia. Prepare a five-page presentation that includes the latest news, earnings and a peer comparison.”
LLM Suite created a credible-looking PowerPoint deck in about 30 seconds.
“You can imagine in the past how that would have been done; we would’ve had teams of investment banking analysts working long hours at night to do this,” said Waldron.
The bank is also training AI to draft other key investment banking documents including the “inch thick” confidential memos that JPMorgan produces for prospective M&A clients, said the person who attended the July executive meeting.

Derek Waldron, JPMorgan’s chief analytics officer.
Courtesy: JP Morgan

The prospect of collapsing work loads means that fewer junior bankers may be needed even while AI-enabled teams handle more work and pitch more companies, according to senior Wall Street executives at several firms who spoke on the condition of anonymity to provide their candid thoughts.
But to extract the full value from this new, almost magical technology, it’s not just about the tools: Changes to how employees and departments are organized may be needed.
One proposal being discussed at a major investment bank is reducing the ratio of junior bankers to senior managers from the current 6-1 to 4-1. In the new regime, half of those junior bankers would be working from cities with cheaper labor, say Bengaluru, India, and Buenos Aires, Argentina, instead of being clustered in expensive New York.
The AI-powered junior bankers could then work on deals in shifts around-the-clock, passing the baton from one time zone to the next.
With fewer bankers on the payroll, the cost structure of investment banking would fall, boosting the bottom line, said the executives.

Structural shifts

Unlike previous generations of technology, where bespoke automation tools had to be made for every distinct job, LLM Suite can service them all, from traders to wealth managers and risk officers, according to Waldron.
The implications for workers are profound. AI will empower some workers and give them more time, positioning them at the center of a team of AI agents. Others will be displaced by AI that takes over processes which no longer require human intervention.
That shift favors those who work directly with clients — a private banker with a roster of rich investors, traders who cater to hedge fund and pension managers, or investment bankers with relationships with Fortune 500 CEOs, for instance.
Those at risk of having to find new roles include operations and support staff who mainly deal in rote processes like setting up accounts, fraud detection or settling trades.
In May, JPMorgan’s consumer banking chief told investors that operations staff would fall by at least 10% in the next five years thanks to AI deployment.
“In an AI world, you’ll still have people at the top who are managing and have relationships with clients, but many, many of the processes underneath are now being done by AI systems,” Waldron said.

AI FOMO

But it’s still unwritten as to how that future will unfold; will corporations retain workers impacted by AI, retraining them for the new roles it creates? Or will they simply opt to cut their payroll?
“Without a doubt, AI technology will have changes on the construction of the workforce,” Waldron said. “That is certain, but I think it’s unclear as to exactly what those changes will look like.”
More broadly, Waldron said that workers would shift from being creators of reports or software updates, or “makers” in his terminology, to “checkers” or managers of AI agents doing that work.
The bank is closing in on another frontier: It will soon allow generative AI to interact directly with customers, Waldron said. JPMorgan will start with limited cases, like allowing it to extract information for a user, before rolling out more advanced versions, he said.
Despite market concerns that the AI trade is a brewing bubble, corporate clients are actually more worried now that if they don’t start adopting it soon, they’ll fall behind and lose share, said Avi Gesser, a Debevoise & Plimpton partner who advises corporations on issues around AI.
“People are starting to see what these tools can do,” Gesser said. “They’re sort of like, ‘Wow, if you get the workflow right, implement it properly and have the right guardrails, I could see how that would save you a lot of time and a lot of money and deliver a better product.” More

Charlie Javice, founder of a startup acquired by JPMorgan Chase in 2021 for $175 million, was sentenced to seven years in prison Monday for defrauding the bank by overstating how many customers the fintech firm had.
A jury found Javice and her chief growth officer Olivier Amar guilty on three counts of fraud and one count of conspiracy to commit fraud.
Javice said she felt profound remorse for her actions and asked for forgiveness from JPMorgan, employees of the startup, shareholders and investors.

US businesswoman Charlie Javice (L), founder of Frank, arrives for her sentencing hearing at federal court in Manhattan on Sept. 29, 2025, in New York City.
Timothy A. Clary | AFP | Getty Images

Charlie Javice, founder of a startup acquired by JPMorgan Chase in 2021 for $175 million, was sentenced to just over seven years in prison Monday for defrauding the bank by overstating how many customers the fintech firm had.
In March, a 12-person jury found Javice and her chief growth officer Olivier Amar guilty on three counts of fraud and one count of conspiracy to commit fraud. Prosecutors had sought a sentence of 12 years.

Javice, 33, cried as she delivered an emotional statement to the court Monday. Standing to address the judge, Javice said she felt profound remorse for her actions and asked for forgiveness from JPMorgan, employees of the startup, shareholders and investors.
At one point, Javice turned and directly addressed her family, sitting in the front row, to apologize and thank them for what she called unwavering support.
“I will spend my entire life regretting these errors,” Javice said.
“I’m asking with all of my heart for forgiveness,” she said. “I ask your Honor to temper justice with mercy … I will accept your judgment with dignity and humility.”
Judge Alvin Hellerstein told Javice her words were “very moving” and that the way she’s devoted her life is “highly commendable,” but that he couldn’t give her the forgiveness she sought.

“I sentence people not because they’re bad, but because they do bad things,” Hellerstein told Javice before delivering the 85-month prison sentence. “I don’t think you’ll be committing other crimes and that you’ll be devoting your life to service, but others have to be deterred.”
In addition to prison, Javice was sentenced to three years of supervision, along with $22.36 million in forfeiture and $287 million in restitution to JPMorgan. She will remain out on bail while she appeals the ruling.

JPM acquisition

JPMorgan bought the startup, called Frank, to help the biggest U.S. bank by assets market its financial products to students. Frank was a digital platform that helped students apply for financial aid. In September 2021, JPMorgan told CNBC in an exclusive interview on the deal that the fintech firm had served more than five million students since Javice founded it.
But months after the deal closed, JPMorgan discovered that Frank had fewer than 300,000 real customers; the rest were synthetic identities created by Javice with the help of a data scientist.
Javice was arrested in 2023 on charges that she defrauded JPMorgan in the deal. Details that emerged later showed that Frank employees expressed disbelief when Javice directed them to boost their customer roster before the acquisition.
The week before selling her company to JPMorgan, Javice directed an employee to fabricate millions of users. When the employee declined, Javice reassured him, according to testimony given earlier this year.
“She said: ‘Don’t worry. I don’t want to end up in an orange jumpsuit,'” the employee testified.

Not Theranos

On Monday, Javice’s attorney Ronald Sullivan argued for a lighter sentence for his client, making the case that Frank helped customers. He contrasted the case against that of Elizabeth Holmes of Theranos infamy, whose fraud he said had “dangerous medical consequences,” and who was sentenced to 135 months in prison.
“Ms. Javice’s sentence should be nowhere near Elizabeth Holmes,'” Sullivan told Judge Hellerstein.
Assistant U.S. Attorney Micah Fergenson disagreed, arguing that Javice’s crime was fueled by greed.
“JPMorgan didn’t get a functioning business, they acquired a crime scene,” Fergenson said.

A courtroom sketch of Charlie Javice at her sentencing at court on Sept. 29, 2025 in New York City.
Elizabeth Williams | CNBC

The episode was embarrassing for JPMorgan, which was thought to be one of the most sophisticated of corporate acquirers. Concerned about threats from fintech and big tech firms, the bank, led by CEO Jamie Dimon, went on a shopping spree of smaller fintech firms starting in 2020.
But JPMorgan, eager to edge out rivals bidding for the startup, failed to confirm that Frank actually had millions of customers before shelling out $175 million for the company. More

Once Upon a Farm, the baby food company co-founded by actor Jennifer Garner, filed for IPO under the ticker “OFRM” on the NYSE.
Goldman Sachs and J.P. Morgan are acting as joint lead underwriters.
The Berkeley-based company increased its six-month revenue as of Jun. 30 by 66% according to its IPO filing.

General view of the products during Once Upon A Farm Refrigerated Oat Bar Launch Event at 1 Hotel Brooklyn Bridge on Oct. 7, 2023 in Brooklyn, New York.
Jamie McCarthy | Getty Images

Jennifer Garner’s baby food company Once Upon a Farm announced on Monday it has filed a registration statement with the U.S. Securities and Exchange Commission (SEC). It intends to list its common stock under the ticker “OFRM” on the New York Stock Exchange pending approval.
The company increased its six-month revenue as of Jun. 30 by 66% according to its IPO filing. The company acknowledged in the filing that it has a “history of losses, and we cannot be certain that we will achieve or sustain profitability.”

Goldman Sachs and J.P. Morgan are acting as joint lead underwriters for the proposed offering, the company shared in a statement.
Founded in 2015 by Cassandra Curtis and Ari Raz, Once Upon a Farm sells food for babies and kids, according to its website. They founded the company with a mission to provide nutritious and convenient food for babies before expanding their offerings to children of all ages.
The Berkeley-based company sells a variety of refrigerated pouches and oat bars, frozen meals, and pantry snacks. All of its over 115 products are organic, non-GMO, contain no added sugar, and are free from artificial flavors, colors, and preservatives, the company said in a statement.
A 15-pack of their best-selling Dairy-Free Smoothie Variety Pack retails for $61.50, according to its website.
Garner, a Golden Globe Award winner known for her starring role as Sydney Bristow in the ABC spy drama Alias, joined Once Upon a Farm as a co-founder in 2017. She posts about her family farm in Locust Grove, Oklahoma, which the company says is a source of inspiration for their products, to her personal Instagram account.
Once Upon a Farm did not immediately respond to a request for comment. More

Wealthfront, the startup that helped popularize the robo-advisor style of automated investing, filed for a U.S. initial public offering Monday.
It’s the latest in a wave of fintech firms going public this year after the likes of Chime and Klarna.
Wealthfront, led by CEO David Fortunato, had $88.2 billion in assets on its platform and served 1.3 million customers as of July 31, according to the filing.

Wealthfront app.
Source: Wealthfront

Wealthfront, the startup that helped popularize the robo-advisor style of automated investing, filed for a U.S. initial public offering Monday, making it the latest in a wave of fintech firms going public this year including Chime and Klarna.
The company in June filed confidentially for an IPO, but waited until now to make that filing public. That signals that Wealthfront is planning on kicking off its roadshow to pitch shares to investors; an IPO typically follows weeks after the S-1 filing is made public. The company intends to list on Nasdaq under the ticker symbol “WLTH.”

Wealthfront, led by CEO David Fortunato, had $88.2 billion in assets on its platform and served 1.3 million customers as of July 31, according to the filing. It generated $194.4 million in net income on $308.9 million in revenue during in fiscal 2025 which ended on Jan. 31, per the filing.
“Our clients are primarily digital-native high earners who prioritize savings and wealth accumulation,” the company said. “Digital natives typically have large liquid savings with long time horizons ahead, and they are undeterred by corrections and bear markets.”
The company, founded in 2008, has had a long and winding journey to the public markets.
Along with rival Betterment, Wealthfront helped define the robo-advisor category, which uses algorithms to automate investment decisions for customers.
Within years, big banks including Morgan Stanley and Bank of America unveiled their own robo offerings to complement their large armies of human financial advisors.

In 2022, the Zurich-based global bank UBS said it was buying Wealthfront for $1.4 billion in cash, but the deal collapsed as the market turned suddenly skeptical on fintech firms amid rising interest rates.
It’s taken years for the market for fintechs to recover, leading to a rebound in listings this year.
Founded in 2007 and based in Palo Alto, California, Wealthfront employed 359 people as of July 31, according to the filing.
— CNBC’s Jordan Novet contributed to this report. More

Prediction markets are pricing in about a 70% chance that the federal government will shut down on Wednesday.
Users on Kalshi and Polymarket increased their bets after the Labor Department said it won’t release Friday’s key jobs report, watched closely on Wall Street, in the event of a shutdown.

A stop sign is seen at a security checkpoint at the U.S. Capitol in Washington, D.C., on March 24, 2019.
Andrew Caballero-reynolds | Afp | Getty Images

Prediction markets are pricing in about a 70% chance the federal government will shut down on Wednesday, reflecting growing skepticism that lawmakers will strike a last-minute deal to keep agencies funded.
Users on Kalshi and Polymarket increased their bets on a government closure after the Labor Department said it won’t release Friday’s key jobs report, watched closely on Wall Street, in case of a shutdown. Over the weekend, the odds were at around 50%.

Arrows pointing outwards

The elevated odds underscore deepening dysfunction in Congress, where disputes over spending levels escalated. While Democrats want the funding bill to include extensions to Affordable Care Act insurance subsidies, Republican leaders are saying that debate should wait until after a shutdown is averted.
President Donald Trump is expected to meet with the top four congressional leaders Monday after abruptly canceling a meeting with Democratic leadership last week.
The Trump administration last week told federal agencies to begin preparing for mass firings if Congress does not agree to a deal to avert a shutdown. If the White House follows through on its threat, it would mark a break from precedent. In past shutdowns, federal employees have been furloughed but not permanently laid off. More

Wells Fargo shares have more in the tank despite a downgrade from Wall Street analysts, according to Jim Cramer. The news Morgan Stanley analysts on Monday lowered their Wells Fargo rating to an equal weight hold from an overweight buy. They cited a lack of catalysts for the stock now that Wells Fargo’s $1.95 trillion asset cap has been lifted . “We were [overweight] Wells heading into the asset cap removal, viewing it as an underappreciated catalyst for faster EPS growth,” Morgan Stanley said. “We see more limited upside from here relative to our [overweight] rated stocks.” The analysts also argued that Wells Fargo will “not be a beneficiary” of interest rate cuts. That would mean less upside for the bank’s net interest income (NII), they said, which is a major source of revenue stream. The Federal Reserve issued its first quarter-point reduction in roughly nine months at its September meeting. The market favors 50 basis points of further Fed rate easing before year-end. Central bankers meet at the end of October and in December. Still, Morgan Stanley raised its price target on Wells Fargo’s stock to $95 per share from $87 apiece, implying more than 11% upside from Friday’s close. “We still believe that Wells is positioned to grow above the industry average in a post-cap environment. While management has spoken about a more tempered growth outlook, we see a meaningful opportunity given the lack of fixed income financing supply for institutional clients, which is exactly where Wells is leaning in,” the analysts wrote. “The bank is operating with excess capital and, in our view, has little need to build further. This opens the door for greater capital return.” Wells Fargo shares fell 1% following Monday’s call, but remain up more than 20% year-to-date. For 2025, that beats the S & P 500 ‘s 13% advance. Big picture The Morgan Stanley downgrade comes less than four months after the Fed lifted the asset cap on Wells Fargo. The cap was put in place, as were many other punitive measures, for wrongdoings that predated CEO Charlie Scharf’s tenure. Under Scharf’s leadership, the bank has implemented a turnaround plan that expands further than getting its asset cap removed, though. Wells Fargo has made significant strides to diversify its business to rely less heavily on NII, which are at the mercy of the Fed’s monetary policy moves. That’s why Wells Fargo has grown its presence in investment banking and capital markets. These tend to derive revenue from fees, which come from services such as advising for mergers and acquisitions and underwriting initial public offerings. WFC YTD mountain Wells Fargo (WFC) year-to-date performance That’s not all Wells Fargo has up its sleeve. The bank is pushing for long-term growth in credit cards, too, by better leveraging its massive customer base and cross-selling services. Wells Fargo has launched at least nine new credit cards since 2021. CFO Michael Santomassimo said earlier this month that credit cards would become a “meaningful contributor” to the bank’s bottom line within the coming years. Credit cards are “a huge opportunity for us to continue to grow,” Santomassimo said at an industry conference . Bottom line What Morgan Stanley analysts failed to see is that Wells Fargo’s profits are not as reliant on the Fed’s monetary policy moves as they once were. The bank has more going for it than its net interest income. Management has made that clear by investing more in the aforementioned fee-based corporate and investment banking division. “Our pushback is that we know [Wells Fargo is] not really emphasizing NII. They want to become more fee-based. They want to lead more in capital markets, which is on fire by the way,” Jeff Marks, the Investing Club’s director of portfolio analysis, said during Monday’s Morning Meeting. “We continue to see a healthy pipeline of IPOs. That’s really what they’re pushing for, so they’re not subject to the … NII game.” “Charlie Scharf’s going to have the last laugh there,” Jim said during ” Squawk on the Street .” We don’t take issue with a hold rating. We have our hold-equivalent 2 rating on Wells Fargo. It’s that the Morgan Stanley analysts are too focused on the NII ways of the past and not the groundwork to expand nascent business lines and further diversify its revenue base in the future. New investors, Jim said during the Morning Meeting, could consider picking up shares here. While shares have been performing in line with the KBW Bank ETF this year, they have lagged the popular exchange-traded fund since the asset cap’s removal in early June. “This is still a very cheap stock even up here,” Jim added. “I’m a big believer in Charlie Scharf. I think if you don’t own any stock, you probably do want to pick at it.” Correction: This story has been updated to reflect that Morgan Stanley’s new price target implies more than 11% upside from the stock’s Friday close. (Jim Cramer’s Charitable Trust is long WFC. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. More

Cleveland Federal Reserve President Beth Hammack joined CNBC’s “Squawk Box Europe” on Monday to discuss the health of the U.S. economy.
Asked whether it is mistake for the Fed to be cutting interest rates given the economic backdrop, Hammack described it as “a challenging time for monetary policy.”
Investors have recently dialed back their expectations for rapid Fed rate cuts.

Federal Reserve Bank of Cleveland President Beth Hammack attends the Federal Reserve Bank of Kansas City’s 2025 Jackson Hole Economic Policy Symposium, “Labor Markets in Transition: Demographics, Productivity, and Macroeconomic Policy”, in Jackson Hole, Wyoming, U.S., August 21, 2025.
Jim Urquhart | Reuters

Cleveland Federal Reserve President Beth Hammack on Monday said the U.S. central bank faces challenges as it attempts to balance fighting stubborn inflation or protecting jobs.
“On the inflation side right now, I continue to be worried about where we are from an inflation perspective,” Hammack told CNBC’s “Squawk Box Europe.”

“We have been missing our mandate on the inflation side, our objective of 2%, for more than four-and-a-half years and I continue to see that we have pressure in inflation both in the headline, in the core, and particularly, where I am worried about it, is I’m seeing it in the services,” she added.
Asked whether it is mistake for the Federal Reserve to be cutting interest rates given the economic backdrop, Hammack described it as “a challenging time for monetary policy,” saying the U.S. central bank was facing pressure on both sides of its mandate.

Her comments come shortly after stronger-than-expected economic data appear to have dented Wall Street’s hopes for sharp monetary easing.
The Fed approved a widely anticipated rate cut earlier this month, lowering its benchmark overnight lending rate by a quarter percentage point to a range of 4.00%-4.25%, and signaled two more were on the way before the end of the year.
A robust batch of economic data since, however, has prompted investors to dial back their expectations for rapid rate cuts.

Investor attention now turns to the September nonfarm payrolls report, scheduled for Friday, although its release could be disrupted by a possible government shutdown.
Hammack said the U.S. labor market looks “reasonably healthy” and broadly in balance, while inflation remains stubbornly above the Fed’s target, adding that she doesn’t expect prices to fall back to 2% until the end of 2027 or early 2028.
“So, again, to me, when I balance those two sides of our mandate, I think we really need to maintain a restrictive stance of policy so that we can get inflation back down to our goal,” Hammack said.
A former Goldman Sachs executive, Hammack is not a voter on the rate-setting Federal Open Market Committee this year.

Two-sided risks

U.S. core inflation was little changed in August, according to data published Friday. The personal consumption expenditures price index posted a 0.3% gain for the month, putting the annual headline inflation rate at 2.7%, the Commerce Department reported late last week.
Excluding food and energy, the more closely followed core PCE price level was 2.9% on an annual basis after rising 0.2% for the month.
Hammack has previously suggested she would be hesitant about lowering interest rates as long as inflation remains a threat.
Indeed, more recently, Federal Reserve Chair Jerome Powell warned of a tricky path ahead on interest rates.
“Near-term risks to inflation are tilted to the upside and risks to employment to the downside — a challenging situation,” Powell said on Sept. 23 during a speech to business leaders in Providence, Rhode Island.
“Two-sided risks mean that there is no risk-free path,” he added.
— CNBC’s Jeff Cox contributed to this report. More

President Donald Trump posted on Saturday a cartoon image depicting him pointing his finger and shouting “YOU’RE FIRED!” to Federal Reserve Chief Jerome Powell.
The image appears to be “AI-generated or digitally illustrated,” according to visual analysis by ChatGPT.
Trump attempted to fire Fed Governor Lisa Cook in August on alleged mortgage fraud in a case that now sits with the Supreme Court with Fed independence on the line.

U.S. President Donald Trump passes a document to Federal Reserve Chair Jerome Powell to fact-check the numbers during a tour of the Federal Reserve Board building, which is currently undergoing renovations, in Washington, D.C., U.S., July 24, 2025.
Kent Nishimura | Reuters

President Donald Trump posted on Saturday a cartoon image depicting him firing Federal Reserve Chairman Jerome Powell.
The post on Truth Social was an image of himself pointing his finger and shouting “YOU’RE FIRED!” to Powell, who was holding a box with his belongings. Behind them is a depiction of the seal of the Federal Reserve.

The image appears to be “AI-generated or digitally illustrated,” according to visual analysis by ChatGPT.
Trump has repeatedly criticized Powell for his cautious approach to cutting interest rates, nicknaming him “Too Late Powell.” The latest threat came even as the central bank lowered rates earlier this month for the first time this year. Powell’s term as chair ends in May 2026.
The White House didn’t immediately respond to CNBC’s request for comment.
Firing the top central banker would be unprecedented as no U.S. president ever has attempted to do so, though others have criticized prior Fed chairs. A recent Supreme Court decision indicated that the president does not have the authority to remove Fed officials at will.  Powell has said repeatedly that his firing is “not permitted under the law.”
The Trump White House has blasted Powell over renovations to the Fed’s Washington headquarters, raising suspicion that Trump could try to remove the Fed leader for cause. Although lately Trump has eased his criticisms of the Fed building, while continuing to be vocal about Powell hurting the economy by keeping rates too high in his view.

Trump attempted to fire Fed Governor Lisa Cook in August on alleged mortgage fraud. The Supreme Court is set to rule on that matter soon. The Department of Justice on Friday said in a Supreme Court filing that firing Cook for alleged misconduct would not harm the financial markets. Cook’s attorneys argued in a prior filing to the high court that her removal could ruin Fed independence.
So far, the financial markets have shown little reaction to Trump’s Powell threats or Cook’s attempted firing. Though many economists and investors believe firing Powell before his term ends could cause longer-term interest rates to rise on the notion the Fed would start to act in Trump’s interests and not according to its dual mandate from Congress of stable inflation and low unemployment. More