U.S. billionaire Warren Buffett said on Saturday that he was 100 percent behind Goldman Sachs which was sued last month by the U.S. Securities and Exchange Commission for misleading clients.

"I did not hold it against Goldman Sachs that an allegation has been made," said Buffett, CEO of holding company Berkshire Hathaway, which invested 5 billion dollars in Goldman Sachs during the financial crisis in 2008.

Buffett insisted that he "loves" Berkshire's investment in Goldman Sachs and believes the firm remains the best investment bank in the world.

He also defended the troubled Goldman Sachs CEO, Lloyd Blankfein.

"My choice would be to have Lloyd running it this year, next year and 10 years from now," Buffett said in Omaha, where he was attending Berkshire's annual meeting. "Running Goldman is a big job, and there's nothing I could improve on."

Meanwhile, Buffett said he worried about the possibility of "significant inflation" in the U.S. and other countries.

"The prospects for significant inflation have increased, not only here but around the world," Buffett said at the annual meeting. "If you had to bet your life on higher or lower inflation I'd bet on higher, and maybe a lot higher."

"Weaning ourselves from the medicine" of government economic stimulus may be very difficult, he added.

He also noted that the Greece debt crisis "will be high drama" and possibly a "test case" for bailing out a country using a common currency.

"I really don't know how this movie ends, and I try not to go to movies like that," said the billionaire, adding he was "more bearish" on whether currencies will be able to hold their value in coming years.