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(CNN Business) —  

America’s top finance chiefs are on high alert for a recession. For the first time in several years, economic uncertainty is now their lead concern, replacing worries about the difficulty of hiring and retaining talented workers.

Fifty-three percent of chief financial officers expect the United States to enter a recession prior to the 2020 presidential election, according to the Duke University/CFO Global Business Outlook survey released on Wednesday. And two-thirds predict a downturn by the end of next year.

US business optimism dropped to a three-year low during the third quarter, the Duke survey said, reflecting a spike in economic uncertainty as the US-China trade war drags on.

Just 12% of US CFOs indicated they have become more optimistic about the domestic economy, down from 44% a year ago, according to the Duke survey.

The findings are consistent with recent surveys of investors and market signals that show a rising risk of a recession.

Business spending to weaken

The risk is that these fears become a self-fulfilling prophesy. When CFOs are nervous, they tend to scale back on spending on things like factories and new equipment. That in turn slows the economy.

US business spending is expected to inch just 0.6% higher over the next 12 months, the Duke survey found. That’s a sharp deceleration from 8% growth projected in March and the second lowest growth since December 2009.

“I do think this could become a self-fulfilling recession,” John Graham, a finance professor at Duke University’s Fuqua School of Business and director of the survey, told CNN Business. “If we are teetering on the edge of recession and companies are already worried, it’s going to make it more likely we tip into a recession.”

CFOs have also dialed back their expectations of earnings and revenue growth, as well as projections for how much they can raise prices for their products.

Trade war jitters

Not only is the trade war increasing uncertainty, but the tit-for-tat battle has deepened the global manufacturing slowdown. Factory activity in the United States contracted in August for the first time in three years.

FedEx oney.cnn.com/quote/quote.html?symb=FDX&source=story_quote_link” > (FDX), a bellwether for the economy, oney.cnn.com/quote/quote.html?symb=FDX&source=story_quote_link” > (FDX)-Corp.-Reports-Quarter-Earnings” target=”_blank”> dimmed its earnings outlook on Tuesday and announced plans to cut costs due to the trade war and weakening of global growth.

“Our performance continues to be negatively impacted by a weakening global macro environment driven by increasing trade tensions and policy uncertainty,” FedEx CEO Fred Smith said in a statement.

The Duke survey has consistently pointed to 2020 as the year when a recession could strike.

In December, 82% of CFOs predicted a recession by the end of 2020. However, that 2020 recession call has fallen to about about two-thirds during the past two surveys.

The Duke survey, which also questions CFOs outside the United States, found that pessimism isn’t just an American problem. Eighty-one percent of CFOs in Africa expect a recession will begin in their countries by the third quarter of 2020. The majority in Canada (68%), Europe (69%), Asia (72%) and Latin America (65%) said the same.

Graham said that there is a “strong correlation” between the sentiment measured in his survey and what happens with GDP, employment and earnings growth.

“When optimism is low,” Graham said, “12 months later economic activity is weak.”

Recession might not be called until after the election

Sophisticated investors are also bracing for economic trouble.

Thirty-eight percent of fund managers polled by Bank of America Merrill Lynch expect a recession over the next year, compared with 49% who see a recession as unlikely. That’s the highest net recession risk since August 2009, Bank of America said.

Recession worries have been driven in part by red lights flashing in the bond market. The yield curve recently inverted, meaning short-term Treasury rates are above long-term ones. In the past, that has been a reliable recession indicator.

A closely-watched New York Federal Reserve model, based on the yield curve, recently showed the chance of a recession in the United States over the next 12 months climbed to 38%. That’s also the highest since the Great Recession.

Even if a recession does strike before the 2020 election, it doesn’t mean voters will necessarily know about it before heading to the polls, although they would likely have a sense growth is slowing.

For instance, the National Bureau of Economic Research, the entity that determines when business cycles end, didn’t call the Great Recession until 11 months after it had begun in December 2007.

Will a trade deal prevent a recession?

There are ways to boost the slowing economy.

For instance, the fund managers polled by Bank of America cited the possibility of German fiscal stimulus, a sharp rate cut by the Federal Reserve, and massive Chinese infrastructure spending over the next six months.

Others are holding out hope for a trade agreement between Washington and Beijing that rolls back existing tariffs, or at least prevents new ones from getting implemented.

But it’s unclear if China would be willing to give President Donald Trump a political boost by making an agreement prior to the 2020 election.

“The chances of a trade deal are zero,” said Jeffrey Gundlach, CEO of DoubleLine Capital, said during a conference call on Tuesday. “China has no incentive to make a trade deal.”