(Reuters) – Goldman Sachs Group Inc. (GS.N) is planning for a period of sluggish growth and higher inflation, the bank’s president John Waldron said on Thursday, calling it “a mini-stagflation scenario.”

There will be a tougher environment for capital markets and financing as CEOs remain cautious, Waldron told a Bloomberg conference on Thursday.

“We’re planning for that scenario to be more likely, doesn’t mean it will happen,” he said.

“The primary debate to me is inflation. When I talk to our clients … the single biggest debate that I hear is, how sticky will it be,” he said.

Despite the U.S. economy showing resilience, concerns remain among investors that a recession could happen in an environment of stubborn inflation and high borrowing costs.

There are uncertainties on the degree of the economic slowdown, with many fearing that the impact of higher interest rates has yet to be fully felt in areas such as private credit, or real estate.

Waldron said he cannot say anything with certainty about more job cuts at the group, but reiterated that “we are running the firm tighter, we are being more cautious.”

The firm is expected to cut just under 250 jobs in the coming weeks, a source familiar with the matter told Reuters in May. In January, it let go about 3,200 employees, its biggest headcount reduction since the 2008 financial crisis.

He also said risk appetite for its clients is lower.

“You’re certainly seeing reduced business investment,” he said.

“I still come back to the combination of inflation and geopolitics as two big areas that we have to get a little bit of a better understanding of,” he said, referring to the war in Ukraine and U.S.-China relations.