(Reuters) – Jamie Dimon, Chairman and Chief Executive Officer of JPMorgan Chase, warned investors on Monday that the disorder caused by American customs duties could weigh on the growth of the greatest economy in the world, stimulating inflation and having a long -term negative impact.

In his annual letter to shareholders, published after the New York Stock Exchange has unscrewed for two consecutive sessions at the end of last week, Jamie Dimon warned against the consequences of the trade war launched by Donald Trump on relations between the United States and their long-standing business partners.

Asian scholarships also closed sharply on Monday.

“The economy faces considerable turbulence (including geopolitical), with the potentially positive aspects of tax reform and deregulation and potentially negative aspects of customs and ‘commercial wars’, persistent inflation, high budget deficits and still fairly high active prices,” said the manager.

At the head of JPMorgan for 19 years, Jamie Dimon, 69, is one of the influential votes in the business world.

“We are likely to see inflationary results (…) The question of whether the pricing menu will cause a recession remains unanswered, but that will slow growth,” he warned.

JPMorgan economists have also noted at 60% the risk that the United States will experience a recession this year, against 40% a month ago, after Donald Trump announced last week the establishment of new “reciprocal” customs duties including rates of 20% for imported European Union products and 34% for those from China.

Jamie Dillon underlined the risk of reprisals on the part of other countries and said that customs duties could affect economic confidence, investments, capital flows, business profits and the dollar.

“The faster this question will be resolved, the better, because some of the negative effects increase cumulatively over time and would be difficult to reverse,” he insisted.

Customs prices also raise questions about interest rates management.

Jamie Dimon noted that, despite the recent drop in rates due to the low dollar, slower growth and a reduction in risk appetite could increase rates, recalling the “stagflation” of the 1970s.

The expectations of modest American growth, following the scenario of a “gentle landing”, could also be disappointed.

“We are entering this period of uncertainty with high prices for actions and debt, even after the recent decline (…) The markets always seem to assess the assets by assuming that we will continue to have a smooth landing. I am not so sure,” said Jamie Dimon.

(Written by Nupur Anand, Noemie Naudin, edited by Augustin Turpin)

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