CNBC reports that Sean Yokota, Singapore head of markets at the SEB, warns that stock markets are set to see losses ahead, and Japanese stocks could wind up being the hardest hit.

“For the next couple of months, I think you’re going to see some downside risk, especially going into the fall. I think stock markets are in for a correction,” Yokota said.

He said Japanese markets could “suffer the most in this environment” as the country struggles with rising Covid cases as well as lackluster inflation.

Investor sentiment has also been weighed down in recent weeks by concerns over whether the global economic recovery from the pandemic has already peaked. While the U.S. economy is now larger than it was before the pandemic, its growth rate may have peaked at a much slower than expected pace.

SEB’s Yokota said he sees a slowdown in growth ahead.

“You can have transitory inflation, you could have transitory growth as well, where this pent up demand that you had fades away,” he said.

Higher inflation tends to pressure stock prices as it reduces expectations for earnings growth. Rising inflation in the U.S. has sent jitters through the market this year, raising concerns about whether the Federal Reserve may roll back its easy policies earlier than expected.