Is the US Headed for a Recession?

When short-term rates exceed long-term rates (inversion), it has preceded every recession since 1955.

Triggers when unemployment rises 0.5% above its 12-month low. Zero false positives since 1970.

Calculates 12-month forward recession probability using the Treasury spread.

Rising unemployment indicates economic contraction and reduced consumer spending.

Low confidence leads to reduced spending, which can trigger economic slowdowns.

Spike in new unemployment filings signals labor market weakness.

Output from manufacturing, mining, and utilities. Declines signal economic contraction.

Consumer spending drives 70% of GDP. Falling sales often precede recessions.

Leading indicator — housing activity often turns down before recessions begin.

OECD composite leading indicator designed to anticipate turning points in the business cycle relative to trend.

Monthly surveys from NY, Philadelphia, Richmond, Dallas, Chicago, and Kansas City Fed districts track manufacturing conditions.

High yield bond spreads over Treasuries measure credit stress. Widening spreads signal investor fear and tighter financial conditions.

Survey of purchasing managers. Above 50 signals expansion, below 50 contraction. A leading indicator of economic turns.

Temporary employment is a leading indicator — firms cut temps before permanent layoffs. Declining temp help precedes recessions.