The U.S. economy isn’t in recession yet, but is likely facing one in the year ahead, according to the latest survey of chief economists at global financial institutions by the U.S. Securities Industry and Financial Markets Association (SIFMA).

The trade group’s semi-annual survey of top economists finds that, while none of the respondents believe that the U.S. economy is currently in recession, most (83%) expect it to enter recession in the year ahead, with 89% saying the recession will be mild.

The median forecast for annual real GDP growth this year (on a fourth quarter over fourth quarter basis) is just 0.3%, with -0.3% expected for 2023.

“As we continue to turn the corner on the Covid-19 pandemic, the U.S. economy is now facing reverberating consequences due to rising inflation, a tight labor market, and hawkish federal monetary policy,” said Dr. Lindsey Piegza, chief economist and managing director at Stifel Financial Corp. and chair of SIFMA’s Economist Roundtable.

“Looking to the coming year, we can expect many of these same risks to persist. While the United States is not currently in a recession, we can anticipate a potential mild recession in the first half of 2023,” she added.

The deteriorating economic picture comes against the backdrop of tighter monetary policy, with the survey unanimously expecting another 50 basis-point rate hike in December.

Almost half of respondents expect the U.S. Fed funds rate to peak at 5.0% to 5.5%, with most seeing the peak reached in mid-2023.

As rates continue to rise, most economists expect the U.S. Federal Reserve Board to be successful at curbing inflation, with headline consumer inflation expected to finish this year at 7.4%, dropping to 3.1% by the end of next year.

SIFMA noted that most (82%) economists say that the Fed waited too long to tackle rising inflation, and 55% now expect it to overshoot in the opposite direction by tightening too far.

Additionally, just over half (55%) don’t see inflation returning to the 2% target until after 2024.

The survey was completed between November 11 and 25.