Economists echo Dimon\u2019s concerns as US credit downgrade and tariff-driven uncertainty continue.<\/p>\n
JPMorgan Chase CEO Jamie Dimon has warned that he\u00a0can\u2019t rule out the possibility that the United States will fall into what is called stagflation<\/a>\u2014 an economic term that refers to a period when inflation and unemployment are high as economic growth is slow.<\/p>\n In an interview with Bloomberg Television on Thursday, Dimon said, \u201cI don\u2019t agree that we\u2019re in a sweet spot\u201d in response to a question about some US Federal Reserve officials saying that the US economy was in a sweet spot.<\/p>\n Dimon made his comments while at JPMorgan\u2019s Global China Summit in Shanghai. His comments come against the backdrop of the US facing increasing geopolitical tensions, rising deficits and pressure on consumer prices from changing government policies on tariffs that have led retailers to announce a need to raise prices<\/a> and left businesses in a wait-and-watch mode<\/a> over all the economic uncertainties.<\/p>\n Economists like Stuart Mackintosh, executive director of the financial think tank Group of Thirty, echoed Dimon\u2019s concerns to Al Jazeera.<\/p>\n \u201cStagflation is a real risk we cannot rule out. We\u2019re in a circumstance where we have uncertainty on tariffs, uncertainty on many policies that increase the downward pressure on growth in America.\u201d<\/p>\n Last week Moody\u2019s Ratings downgraded the US economy\u2019s<\/a> credit rating. The firm lowered its gold-standard Aaa to an Aa1 credit rating for the US, citing its growing national debt.<\/p>\n \u00a0<\/p>\n Dimon\u2019s Thursday comments were underscored by his remarks at the company\u2019s investor day on Monday.<\/p>\n \u201cCredit today is a bad risk,\u201d Dimon said.<\/p>\n While at the summit, Dimon also offered comments on US President Donald Trump\u2019s \u201cbig beautiful bill\u201d, the tax and spending bill<\/a> passed by the US House of Representatives that includes key parts of the Trump administration agenda including tax cuts, slashes to Medicaid and the Supplemental Nutrition Assistance Program (SNAP), increased funding for immigration enforcement, and new taxes on colleges and universities.<\/p>\n \u201cI think they should do the tax bill. I do think it\u2019ll stabilise things a little bit, but it\u2019ll probably add to the deficit,\u201d Dimon said in a record first obtained by the Reuters news agency.<\/p>\n The nonpartisan Congressional Budget Office has said that the tax bill would add $3.8 trillion to the national debt.<\/p>\n \u2018Inflation going up\u2019<\/p>\n