Big US banks like JPMorgan Chase and Wells Fargo are set to report their first-quarter earnings today, kicking off the earnings season. More banks including Bank of America, Citigroup, and Morgan Stanley will follow next week.
While the banks are expected to show strong results from the past few months, there’s growing concern about the months ahead. President Trump’s new tariffs have shaken global trade and raised fears about a slowdown in the US economy.
Analysts say banks may now speak more cautiously about the future. Even though the economy held up well early in the year, things are changing fast.
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Shares of major banks had gone up by mid-February, but since Trump’s tariff announcements, those same stocks have dropped more than 20%.
Experts believe the trade war could hurt business confidence, reduce loan demand, and weaken banks’ earnings in the coming months.
They’re also worried about a possible recession, which could mean banks lose more money on unpaid loans and make less from investment deals like mergers and stock sales.
On top of that, the Federal Reserve might rethink its plans to lower interest rates, since tariffs could push prices up again. That could affect household spending and slow down the economy even more.
Despite all this, first-quarter earnings are still expected to look good on paper. For example, JPMorgan’s profits are expected to rise nearly 4%, and Citigroup’s by 18%.
But the real test will be how banks talk about the rest of the year and how much damage they think the tariffs will do.
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