Citigroup Chair and CEO Jane Fraser told CNBC that the recent sell-off of U.S. assets following headlines about fresh tariffs and geopolitical tensions is likely to be short-lived. On Tuesday, U.S. equities experienced their steepest one-day drop in two months, the dollar declined by nearly 1.2% against a basket of major currencies and bond prices fell, driving 10-year Treasury yields up by 15 basis points. Investors fled to safe havens such as gold and silver, which rallied 2.3% and 3.1% respectively. Fraser argued these moves represent knee-jerk reactions rather than a lasting shift: “I don’t see where else you go,” she said, adding that strong holiday consumer spending—retail sales rose 6.5% year-over-year in December—and corporate investment in artificial intelligence and deregulation initiatives will sustain momentum for U.S. markets. She cited a Wedbush research note predicting that tariff threats will dissipate as negotiations between the White House and European leaders proceed.

Speaking on the same day, Fraser addressed President Trump’s proposal for a one-year, 10% cap on credit card interest rates, warning that it would restrict access to credit for the most vulnerable borrowers. She highlighted that banks already offer low-cost, no-frill credit products with average annual percentage rates around 12%, and a hard cap could force issuers to exit lower-income segments. Fraser noted that reduced card availability would curb consumer spending—nearly 70% of U.S. GDP relies on household consumption—and could dent revenues in industries such as airlines, retail and hospitality, which collect billions each quarter through co-branded card partnerships. She said Citigroup continues to work with policymakers on alternative measures to improve affordability without sacrificing credit access.