“The war in Ukraine compounded by last week’s attacks on Israel may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships. This may be the most dangerous time the world has seen in decades,” he said in a statement accompanying JPMorgan’s third quarter earnings report.

To his point, experts have warned that the Israel-Hamas conflict could send oil prices surging, particularly if Iran or other major oil suppliers get involved. And Deutsche Bank said earlier this week that the conflict has raised the prospect of 1970’s-style stagflation—a toxic combination of low growth and high inflation. So far, international benchmark Brent crude oil prices have jumped 6% over the past week to nearly $90 per barrel. 

Dimon has repeatedly warned over the past 18 months that the global economy is facing “storm clouds”—from rising interest rates and inflation to geopolitical tensions and a costly energy transition—but he’s always refrained from making specific recession predictions. And once again on Friday, he avoided issuing any dire recession forecasts.

Dimon wasn’t shy about expressing concerns about the economy, however. The CEO said that although consumers remain “healthy” for now, they are quickly spending down the excess savings they built up during the pandemic. And he argued that “persistently tight labor markets” coupled with “the largest peacetime fiscal deficits ever,” have increased the risk of persistent inflation and higher interest rates.

Still, despite the threats on the horizon, Dimon noted in JPMorgan’s earnings call that his bank managed “robust” loan growth and that consumer spending is back to its pre-pandemic trend for now. 

CFO Jeremy Barnum added there are also some “green shoots” in the economy that give him hope, even though the bank’s economists expect a “very mild recession” and despite a number of economic headwinds.

“The overall economic picture, at least currently, looks solid. This sort of immaculate disinflation trade is actually happening,” Barnum told analysts in the Friday conference call. “So those are all reasons to be a little bit optimistic in the near term, but it’s tempered with quite a bit of caution.”

Even amid economic storm clouds, JPMorgan managed to increase its revenue 22% year over year to $39.9 billion in the third quarter, while its net income jumped 35% to $13.2 billion. Both figures topped Wall Street analysts’ consensus estimates as the bank benefited from rising interest rates and its acquisition of First Republic’s assets—a regional bank that the Federal Deposit Insurance Corporation seized in April after it went under.

Despite paying out only 2.53% on average for interest-bearing deposits, JPMorgan has been able to hold on to its depositors during these uncertain times for the U.S. economy because many consumers view the bank’s size as a sign of safety. At the same time, rising interest rates have enabled Dimon’s firm to significantly increase what it earns from its loan portfolio. JPMorgan’s net interest income (NII)—the bank’s earnings from loans minus what it pays depositors—jumped 30% to $22.73 billion in the third quarter as a result. 

Other major U.S. banks, including Wells Fargo and Citi, also turned in strong results Friday as rising interest rates drove increases in their NII.

Wells Fargo stock surged more than 3% by midday Friday after its NII rose 8.3% from a year ago to $13.1 billion in the third quarter, and management raised its full-year 2023 NII forecast. They now believe the all-important figure will climb 16% from a year ago in 2023, compared with a previous estimate of 14%.

Citi stock also jumped over 2.5% by midday Friday after the bank reported its revenue climbed 9% to $20.1 billion in the third quarter. The jump was driven by 17% growth in net interest income amid “higher interest rates and deposit volume growth,” along with rising investment banking fees and trading unit revenues, the bank said in a statement.