[ODUNEWS] July 5 – The probability of a U.S. recession in the next 12 months has soared to 38 percent after consumer confidence hit a low record and interest rates increased, according to a recent Bloomberg Economics forecast on Tuesday.
The probability model, which incorporates a variety of factors ranging from housing permits and consumer survey data to the gap between 10-year and 3-month Treasury yields, is now flashing a 38% probability of a recession over the next 12 months. That’s up from around 0% just a few months before.
Bloomberg Predicts 38% Chance Of U.S. Recession Next Year
“The risk of a self-fulfilling recession—and one that can happen as soon as early next year—is higher than before,” said Anna Wong, chief US economist at Bloomberg Economics. “Even though household and business balance sheets are strong, worries about the future could cause consumers to pull back, which in turn would lead businesses to hire and invest less.”
“The risk of a recession in early 2023 has risen substantially,” Wong said.
