Plain Vanilla 12-month ahead Recession Predictions

Probit regression recession on 10yr-3mo spread and 3 month interest rate:

Figure 1: Estimated recession probability using 1986 onward sample (blue), using pre-pandemic sample (tan), assuming no recession as of May 2025. NBER defined peak-to-trough recession dates shaded gray. Source: NBER, author’s calculations.

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