Leading economists at some of the largest North American banks are predicting that the Federal Reserve's interest rate hikes have come to an end, and there's a likelihood of a roughly one percentage point reduction in rates next year.

Although the United States is expected to avoid a recession, the latest projections from the American Bankers Association's Economic Advisory Committee suggest a significant deceleration in economic growth in the upcoming quarters. This slowdown is expected to result in higher unemployment rates while simultaneously lowering inflation levels.

Simona Mocuta, chair of the 14-member panel and chief economist at State Street Global Advisors, remarked, "Given the evident progress in addressing inflation and the expected improvements, most committee members are of the view that the Federal Reserve's tightening phase has reached its conclusion."

While the upcoming meeting of the US central bank is widely anticipated to maintain the current interest rates, there remains a division among investors regarding the possibility of a rate hike later in the year.

Notably, the ABA advisory committee comprises economists from prominent institutions like JPMorgan Chase & Co., Morgan Stanley, and Wells Fargo & Co., and its forecasts are routinely presented to Fed Chair Jerome Powell and other members of the central bank's board in Washington.