Jamie Dimon urges US to ‘engage’ with China

Good morning and welcome back to FirstFT Asia. We have an interview today with Jamie Dimon, who spoke to the Financial Times about Donald Trump’s trade war. Also on the agenda:

• Nvidia to take a $5.5bn hit

• Australian rightwing election candidate’s ‘anti-woke’ push falters

• How Wall Street got Trump wrong

Donald Trump’s trade war risks eroding the US’s credibility, Jamie Dimon warned, as the JPMorgan Chase chief executive urged Washington to “engage” with Beijing. Here are some highlights from the wide-ranging interview.

Dimon on US credibility: The US remained “a haven” because of its prosperity, rule of law, and economic and military strength, Dimon said. But he warned that America’s economic pre-eminence could come under threat from the president’s attempt to reshape global trade. He also urged the US and China to engage with each other: “I don’t think there’s any engagement right now . . . it doesn’t have to wait a year. It could start tomorrow.”

On market volatility: Dimon’s comments come after Trump’s April 2 “liberation day” announcement of steep “reciprocal” tariffs on many countries sparked a new trade war and triggered wild swings on Wall Street. The JPMorgan chief said the market ructions were “disorderly to the extent that it was a rapid move”, but that “most of the markets were fine”. He added: “The markets are very volatile, it scares people.”

Dimon is one of the most influential voices on Wall Street, and Trump cited his warning last week that tariffs could tip the economy into recession when he moved to pause most “reciprocal” tariffs — something that helped ease market jitters.

On Trump’s trade war: “When they announced the liberation day tariffs, they were dramatically different than people expected. Way off the table than what people expected. And that was shocking to the system. The global system, not just in the United States,” Dimon said. Referring to Trump’s tariff regime, he added: “I think we should be clear-eyed about what we’re trying to accomplish.”

Dimon also weighed in on the White House’s approach to Wall Street, how corporate America should navigate the Trump era — and the closest he ever got to exploring his own presidential bid. Watch the full interview here.

Join our live Q&A today on the changing trade, economic and geopolitical relationship between the US and its allies. Pose your questions to FT journalists here. And here’s what else we’re keeping tabs on today:

• Chinese economy: China reports a batch of data, including the first-quarter GDP estimate, the monthly house price index and industrial output.

• Xi Jinping: China’s leader begins a state visit to Malaysia, as Beijing seeks to strengthen ties with export-reliant south-east Asian economies rattled by Trump’s trade war.

Five more top stories

1. Nvidia has said it expects to take a $5.5bn blow after the US clamped down on the Silicon Valley group’s ability to export artificial intelligence chips to China. The group said in a regulatory filing that the H20 chip, which is tailored for the Chinese market to comply with export controls, will now also require a special license to sell to customers in the country. Nvidia shares fell 4 per cent in after-hours trading.

2. China’s President Xi Jinping has urged Vietnam to work with Beijing to oppose “unilateral bullying”, in a thinly veiled criticism of Trump’s imposition of high tariffs on trading partners. “China’s mega market is always open to Vietnam,” Xi said, as Beijing and Hanoi signed 45 co-operation agreements during his visit.

3. Trump has doubled down on his attacks on Harvard University, threatening to scrap the university’s tax-exempt status. The president’s latest broadside at Harvard came a day after his administration said it was freezing more than $2.2bn in funding for the Ivy League university which has defied the government’s demand to overhaul its governance and student discipline. Here’s more on Trump’s stand-off with America’s elite institutions.

4. A top Trump administration official has warned European allies that they need to choose between US and Chinese technology. It comes as governments and companies in Europe consider whether Starlink — owned by Elon Musk’s SpaceX — is a reliable partner after Washington threatened to switch off its services in Ukraine. Read the full story.

• US-EU trade talks: Washington has told Brussels that some American trade tariffs would remain in place even after negotiations between the two sides, according to European officials.

5. Diamond traders are warning that the $82bn industry has “ground to a halt” because of Trump’s tariffs, with shipments through the gem-trading hub of Antwerp down to about one-seventh of usual levels. India, whose vast polishing industry processes more than 90 per cent of the world’s diamonds, could be particularly impacted.

News in-depth

The US and China are locked in a dangerous trade stand-off, with the world’s two largest economies trading tit-for-tat blows as Donald Trump demands Beijing seek a deal from his administration. China relies on the US as an almost irreplaceable market for its manufactured goods, but Beijing still has plenty of negotiating power — if it can bear the pain.

We’re also reading . . . 

Chart of the day

Hermès leapfrogged LVMH to become the world’s most valuable luxury company yesterday, after shares in the owner of Louis Vuitton tumbled on the back of disappointing first-quarter results. The luxury industry has struggled as middle-class consumers rein in spending and China’s economy falters. Here’s why Hermès has weathered the downturn better than its rivals.

Take a break from the news

The third season of The White Lotus might be set in a fictional resort but it was filmed at the Four Seasons Koh Samui, a five-star hotel on Thailand’s second-largest island. The hit television series has shone a spotlight on the country’s luxury lifestyle market.

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