Two of Japan’s biggest banks said they expect profit growth to slow down this year, striking a cautious tone on increasing global economic uncertainties.

The nation’s second-largest lender, Sumitomo Mitsui Financial Group Inc., is forecasting a 3.3% climb in net profit in the current fiscal year after posting a 38% jump the previous year. Mizuho Financial Group Inc., the third-biggest bank, is projecting a 1.7% rise after a 13% increase.

Both firms expect bad loan costs to drop as the impact of the pandemic eases, but are bracing for a challenging year as the U.S. Federal Reserve and other central banks raise interest rates to fight spiraling inflation stoked by pent-up demand and pandemic-induced supply chain tangles. Those pressures have been made worse by Russia’s invasion of Ukraine and COVID-19 lockdowns in China.