The impacts of the pandemic-era government spending and monetary policy that helped support the U.S. economy have faded, and that makes the country vulnerable to a downturn in the coming months, according to JPMorgan Chase CEO Jamie Dimon.
“I think there’s a chance real numbers will deteriorate soon,” Dimon said at a Morgan Stanley conference on Tuesday, according to a transcript from FactSet.
The U.S. has continued to see growth in total employment and consumer spending this year, even as survey data has shown weakening confidence in consumers and business leaders in the face of the Trump administration’s tariff policies.
Dimon downplayed the survey data, saying that “neither consumers nor businesses ever pick the inflection points,” but said the economy’s “soft landing” was likely to look weaker going forward.
“Employment will come down a little bit. Inflation will go up a little bit. Hopefully, it’s just a little bit,” he said, adding that lower levels of immigration is another complicating for the factor.
Dimon, who has been CEO of JPMorgan since 2006, has a history of sharing cautious or negative outlooks on the economy. His comments on Tuesday were not unusually pessimistic.
The most recent economic data shows both job growth and inflation slowed in May.
Another area that Dimon warned about was private credit, which has become a booming business on Wall Street and is seen as a potential area of concern in the event of a recession. The CEO explained that the risks of private credit are different for banks — which line up the deals and then move them off their books — and for investors who are looking for long-term returns from the asset class.
“Do I think that now is a good time to buy credit if I was a fund manager? No. I wouldn’t be buying credit today at these prices and these spreads,” Dimon said.
