The Likelihood of a US Recession Within the Next 12 months is "Coin Flip." : Mortgage Bankers Association

The chances of a recession over the next 12 months are 50%, according to the Mortgage Bankers Association, who also revised their forecast for the US economy downward.

"[While] a recession is not in our baseline forecast, it is a coin flip at this point, as we estimate a roughly 50% chance that the U.S. could enter a recession over the next 12 months, with the most likely timing being in the first half of 2023," MBA economists said in a news release following its July 2022 Economic Forecast.

The MBA revised its 2022 growth rate downward from last month's forecast of 1.6 percent to 0.6 percent. The Fed's aggressive interest rate policy and the ongoing high inflation rate were cited by the group as two significant stresses on households and businesses that will hinder growth.

"We expect inflation to end the year at around 6% before declining to a 2% to 2.5% range in 2023 and 2024," the MBA noted. By the end of 2022, the Federal Funds rate will reach a range of 3.2 percent to 3.5 percent, according to the team. By the end of the following year, it will increase to a range of 3.75 percent to 4 percent. Meanwhile, the MBA predicted that home sales will fall by about 8%.