Nov
29
2024
Off
Smoothed U.S. Recession Probabilities
The probability of U.S. recession stands at 1.48%. When this recession indicator exceeds 5% (red line), history suggests that the probability of recession increases significantly. The chart shows the smoothed U.S. recession probabilities indicator on a log scale.
Smoothed U.S. recession probabilities are obtained from a dynamic-factor markov-switching model applied to four monthly coincident variables: real personal income excluding transfer payments, index of industrial production, non-farm payroll employment, and real manufacturing & trade sales.
Image: Federal Reserve Bank of St. Louis