I’m not of the mind that a recession is going to be avoided, despite increasing confidence this will be the outcome. However, it is hard to find indicators the recession is here, even when looking at measures Steve Kopits (of 2022H1 recession fame) has mentioned.
Category Archives: recession
Term Spread Watch – Is This Time Different?
A reporter for Marketplace (hear piece at 10 minutes in) asked me today whether this time was different, especially in light of all the positive coincident indicators (Q3 GDPNow has been at 5.6% for a couple weeks; Fed staff has upgraded q4/q4 growth, Goldman Sachs pegs recession probability at 15%). I was (I hope properly) circumspect.
Monthly GDP and Coincident Index
The Brave-Butters-Kelley monthly GDP for June is out. Here’re growth rates of this series compared against the SPGMI (formerly IHS/Markit) monthly GDP, and the Philadelphia Fed’s coincident index, which should track GDP.
Business Cycle Indicators, as of 9/1
With the employment release, and the monthly GDP from SPGMI, we have the following picture of key macro indicators.
Business Cycle Indicators for July
With personal income, consumption, and manufacturing and trade industry sales released, no downturn yet. If consensus holds, the momentum continues into August. Here are some key indicators followed by the NBER BCDC, along with monthly GDP and GDPNow.
The 2022H1 Recession Call in Hindsight, the 2023H2 Call in Context
Back at the beginning of this year, Mr. Steven Kopits asserted that the Philadelphia Fed’s early preliminary benchmark supported a recession in 2022H1, to wit:
Q3 GDPNow at 5.9% (SAAR)
To see how dramatically this bean counting approach deviates from consensus, consider this graph:
No GDP Downturn Forecasted: SPF
In contrast to the July WSJ survey, the just-released Survey of Professional Forecasters mean forecast shows no negative GDP growth.
Guest Contribution: Model update and disagreement among recession models
Today we are fortunate to be able to present a guest contribution written by Rashad Ahmed (Office of the Comptroller of the Currency, US Treasury). The views presented are solely those of the author, and do not necessarily represent the views of the US Treasury, or any other organizations the author is affiliated with.
Business Cycle Indicators, with New Employment Numbers
Continued, albeit slowing, employment growth yields the following picture of key variables followed by the NBER’s Business Cycle Dating Committee (plus monthly GDP, and GDPNow).