In this article, JPMorgan Chase CEO Jamie Dimon expressed his concerns about the possibility of stagflation, despite recent indications that inflation may be moderating. Dimon made these remarks during a fall conference held by the Council of Institutional Investors in Brooklyn, New York. He highlighted that the worst scenario would be stagflation, a combination of recession and higher inflation, and emphasized that he was not ruling it out.
Dimon’s comments come at a time when investors are monitoring signs of economic slowdown. While recent data has shown increasing pricing pressures moving towards the Federal Reserve’s 2% inflation target, reports on employment and manufacturing have suggested some weakening trends. This week, investors are awaiting key data releases, including the consumer price index and producer price index on Wednesday and Thursday, respectively.
Dimon expressed concerns about various inflationary factors on the horizon, such as rising deficits and expanded infrastructure spending, which could continue to strain an economy still recovering from the effects of higher interest rates. He emphasized that these factors are likely to contribute to inflation in the short term, making it challenging to predict a swift recovery. Dimon has previously cautioned about the possibility of an economic slowdown, indicating in August that the likelihood of a “soft landing” was relatively low, with a recession being the more probable outcome.
