Amid growing market concerns over the United States’ fiscal condition, JP Morgan CEO Jamie Dimon warned that investors are currently too complacent about the looming risks to the economy, following the downgrade of the U.S.’s top credit rating by Moody's.

Moody’s officially cut the U.S. government's debt rating from Aaa to Aa1, marking the first time in modern history that the U.S. has lost its triple-A rating from all three major credit rating agencies. The downgrade was driven by rising concerns over a ballooning budget deficit and the country’s soaring national debt, which now stands at US$36.2 trillion.

Speaking during JP Morgan’s Investor Day event in New York, Dimon emphasized that the markets seem overly relaxed in responding to clear fiscal warning signs and policy failures.

"We have a massive deficit, and I believe the central bank is being too complacent. You all assume they can handle it. But I’m not so sure," Dimon said, as quoted by The Guardian.

He further noted that the probability of stagflation is much higher than what most investors currently perceive. "There’s an extraordinary level of complacency," he added.

The Moody’s downgrade comes as President Donald Trump is actively trying to push through a major tax cut and new spending bill in Congress — a legislative package projected to add as much as US$5 trillion to the national debt over the next decade.

In its official statement, Moody’s explained that successive U.S. administrations and Congress have repeatedly failed to reach agreements on measures to reverse the ongoing trend of large annual fiscal deficits and mounting interest expenses.

"We do not believe that the current fiscal proposals will deliver meaningful spending cuts or significant deficit reduction," Moody’s stated.

The agency also cautioned that over the coming decade, the deficit is likely to worsen as mandatory spending rises, while government revenues are expected to remain flat.

U.S. Treasury Secretary Scott Bessent, in an interview with NBC, attempted to downplay the downgrade, calling Moody’s a "lagging indicator."

Meanwhile, President Donald Trump has not issued any official comment in response to the credit rating downgrade.