The U.S. economy is “undoubtedly” headed for a downturn, said Wells Fargo & Co. chief executive Charles Scharf. Charles Scharf. “It’s going to be hard to avoid some kind of recession,” Scharf said during a Future of Everything Festival event organized by The Wall Street Journal.

The Federal Reserve (Fed) has raised rates by 75 basis points (bps) since March of this year and is expected to continue to tighten monetary policy rapidly at upcoming meetings. A prime rate hike entails higher rates on mortgages, credit cards and all other borrowing, which curbs economic activity.

Scharf noted, however, that both consumers and businesses are financially strong by many measures.

“The fact that everyone is so strong right now gives hope that the recession, if it happens, will be short and not so deep,” he said.

Wells Fargo shares fell 2.7 percent in Tuesday trading. They are down 10% since the start of this year, while the S&P 500 stock index is down 15%.