Recession probability monthly projection U.S. 2025 | Statista (2024)

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Recession probability monthly projection U.S. 2025 | Statista? ›

U.S. monthly projected recession probability 2020-2025

Key takeaways

In light of recent economic developments, J.P. Morgan Research has raised the probability of a U.S. and global recession starting before end-2024 to 35%. The probability of a recession happening by the end of 2025 remains unchanged at 45%.

In August 2024, the Sahm recession indicator was 0.57, a slight increase from the previous month. The Sahm Rule was developed to flag the onset of an economic recession more quickly than other indicators.

Basic Info. US Recession Probability is at 61.79%, compared to 56.29% last month and 60.83% last year. This is higher than the long term average of 14.96%.

UN Trade and Development (UNCTAD) forecasts global economic growth to slow to 2.6% in 2024, just above the 2.5% threshold commonly associated with a recession. This marks the third consecutive year of growth below the pre-pandemic rate, which averaged 3.2% between 2015 and 2019.

By August 2025, it is projected that there is a probability of 61.79 percent that the United States will fall into another economic recession. This reflects a slight increase from the projection of the preceding month.

Using data through June, our model projects shelter inflation at 4.8 percent year over year in December 2024 and remaining above pre-pandemic levels through the end of 2025. For reference, shelter inflation is currently 5.2 percent, well above its 3.3 percent average annual growth from 2016 to 2019.

It is considered the most significant downturn since the Great Depression in the 1930s. The term “Great Recession” applies to both the U.S. recession, officially lasting from December 2007 to June 2009, and the ensuing global recession in 2009.

Inverted Yield Curve

Historically, this has been one of the most accurate recession indicators. A yield curve is said to be inverted when long-term interest rates drop below short-term rates.

How long do recessions last? Historically, recessions have lasted anywhere from two months to several years, according to the National Bureau of Economic Research. But our current economic climate presents unique circ*mstances that make it difficult to draw a direct comparison with past events.

How close is the US to a recession? ›

The S&P 500 rallied in the first half of 2024 as investors cheered resilient earnings growth and anticipated that aggressive Fed rate cuts were just around the corner. However, the New York Fed's recession probability model suggests there is still a 61.8% chance of a U.S. recession sometime in the next 12 months.

Industries affected most include retail, restaurants, travel/tourism, leisure/hospitality, service purveyors, real estate, & manufacturing/warehouse. Despite the severity of any past downturn, markets have always recovered, and in many cases, they have seen a monster rebound.

Origin. The Sahm rule originates from a chapter in the Brookings Institution's report on the use of fiscal policy to stabilize the economy during recessions. The chapter, written by Sahm, proposes fiscal policy to automatically send stabilizing payments to citizens to boost economic well-being.

They typically last about a year and often result in a significant output cost. In particular, a recession is usually associated with a decline of 2 percent in GDP. In the case of severe recessions, the typical output cost is close to 5 percent.

The Great Depression that lasted from 1929 through 1938 was actually two of the worst recessions America has ever experienced occurring back to back. Two recessions also occurred back to back in 1980 through 1982, aggravated by the Iranian oil embargo. America averages a recession about once every six years.

Global growth is projected to be in line with the April 2024 World Economic Outlook (WEO) forecast, at 3.2 percent in 2024 and 3.3 percent in 2025. Services inflation is holding up progress on disinflation, which is complicating monetary policy normalization.

2007– The 2007-09 economic crisis was deep and protracted enough to become known as "the Great Recession" and was followed by what was, by some measures, a long but unusually slow recovery.