JPMorgan Chase CEO Jamie Dimon warned that interest rates could rise to 8 percent or higher in a letter to shareholders Monday.

“[W]e are prepared for a very broad range of interest rates, from 2% to 8% or even more, with equally wide-ranging economic outcomes — from strong economic growth with moderate inflation (in this case, higher interest rates would result from higher demand for capital) to a recession with inflation; i.e., stagflation,” Dimon wrote in the letter. 

“Economically, the worst-case scenario would be stagflation, which would not only come with higher interest rates but also with higher credit losses, lower business volumes and more difficult markets,” Dimon continued. “Under these many different scenarios, our company would continue to perform at least okay. Importantly, being prepared means we can continue to help our clients no matter what the future portends.”

Inflation went up in March, according to data from the Department of Labor released Wednesday, but it has slowed significantly since two years ago. The consumer price index (CPI), commonly used to measure inflation, went up 0.4 percent last month. 

Despite inflation cooling off since a 40-year high of 9.1 percent June 2022, the Fed has steered clear of cutting interest rates. 

“Recent readings on both job gains and inflation have come in higher than expected,” Fed Chair Jerome Powell said last week.

Dimon said in his letter that “[m]any key economic indicators today continue to be good and possibly improving, including inflation.”

“But when looking ahead to tomorrow, conditions that will affect the future should be considered,” Dimon wrote.

“For example, there seems to be a large number of persistent inflationary pressures, which may likely continue. All of the following factors appear to be inflationary: ongoing fiscal spending, remilitarization of the world, restructuring of global trade, capital needs of the new green economy, and possibly higher energy costs in the future.”