US President Donald Trump's tariffs have the potential to fuel inflation and slow down economic growth, according to JPMorgan Chase (JPM) Chief Executive Jamie Dimon.

Last week, the White House announced tariffs on imports from several countries, including China and Japan. China on Friday responded with its own retaliatory duties on US products.

"We are likely to see inflationary outcomes" over the short term as a result of tariffs, which are expected to boost input costs and drive demand for domestic products, Dimon said in a shareholder letter published Monday. "Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth," he wrote.

Dimon's comments echo recent remarks made by Federal Reserve Chair Jerome Powell, who said Friday that the Trump administration's tariffs will likely drive inflation higher and hurt economic growth.

The US economy was already weakening before the tariff announcement, Dimon said. "These significant and somewhat unprecedented forces cause us to remain very cautious," he wrote.

Tariffs have the potential to impact the Fed's interest rate decisions, Dimon said. "All things being equal, the slower the growth, the lower the interest rates, and the higher the inflation, the higher the interest rates," Dimon wrote in the letter.

The ongoing market uncertainty will lead to "much higher" volatility in the US Treasury markets, according to Dimon. The two-year Treasury yield retreated 4.1 basis points to 3.63% early Monday, while the 10-year rate gained 4.3 basis points to 4.03%.

The Nasdaq Composite entered a bear market on Friday, characterized by a decline of at least 20% from its peak.

Dimon acknowledged uncertainties around Trump's tariff policy, such as other nations' counter duties and the impact on consumer confidence. "The quicker this issue is resolved, the better because some of the negative effects increase cumulatively over time and would be hard to reverse," Dimon said.