The expansion of the global economy will significantly decelerate in 2023 and 2024, according to a report by the World Bank published on Tuesday.

“The world economy is in a precarious position,” said Indermit Gill, the World Bank Group’s chief economist and senior vice president. The institution forecasts global growth to slow down from 3.1% in 2022 to 2.1% in 2023, according to the World Bank’s Global Economic Prospects report.

The U.S. economy is projected to grow 1.1% in 2023 and slow down to 0.8% in 2024 primarily due to the continuing effects of interest rate hikes since March 2022, according to the report. The report also says U.S. interest rates have harmed emerging market and developing economies, increasing their potential for a financial crisis.

The World Bank expects global trade expansion to decelerate from 6% in 2022 to 1.7% in 2023, according to the report.

The insecure global economy is currently dealing with “the protracted effects of the overlapping negative shocks of the pandemic, the Russian Federation’s invasion of Ukraine, and the sharp tightening of monetary policy to contain high inflation,” according to the report’s executive summary.

“Recent banking sector stress in advanced economies will also likely dampen activity through more restrictive credit conditions,” it continues. “The possibility of more widespread bank turmoil and tighter monetary policy could result in even weaker global growth.”

Three major U.S. banks — Silicon Valley Bank, Signature Bank and First Republic Bank — have collapsed since March.

The American economy slowed to a 1.3% annual growth rate in the first quarter of 2023, according to revised GDP statistics published by the Bureau of Economic Analysis (BEA) in May.

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