As , the probability of a U.S. economic recession began to diminish rapidly after the Federal Reserve implemented a half-point rate cut at its mid-September 2024 meetings.The change follows the recession odds setting a “” pattern, in which the probability of recession peaked for the third time after breaching a 70% threshold. The probability of recession is now rapidly falling.That downward direction is likely to continue as the Federal Reserve is expected to deliver a quarter point reduction in the Federal Funds Rate at the conclusion of its Federal Open Market Committee meetings on Thursday, 7 November 2024. Those meetings start on 6 November 2024, which is why we’re providing this update at this time. We’re showing a portion of the analysis Fed officials have available as they weigh how to set the level of the Federal Funds Rate.The following tracking the probability of recession since 30 April 1983, the period from July 2024 through September 2025 represents the most likely period in which the NBER will say the U.S. economy peaked before beginning a period of contraction. And even though the probability of recession someday being found to have started sometime in the next twelve months is now falling, those odds remain elevated.The current probability of a recession being officially determined to have begun between 1 November 2024 and 1 November 2025 is 64.8%. The featured chart shows that probability ‘pushed out’ to the end of the period for which the recession forecast applies.Analyst’s NotesThe recession probability presented here is based on the Federal Reserve Board’s , which factors in the one-quarter average spread between the and the corresponding one-quarter average level of the . If you’d like to do that math using the latest data available to anticipate where the Recession Probability Track is heading, we have provided a to make it easy to do.We will continue following the Federal Reserve’s Open Market Committee’s in providing updates for the Recession Probability Track until the U.S. Treasury yield curve is no longer inverted and the future recession odds retreat below a 20% threshold. We’re following how this forecasting method performs.More By This Author:Dividends By The Numbers In October 2024 S&P 500 Retreats As Wall Street Bear Takes Away Expected Future Rate CutsMedian Household Income In September 2024
U.S. Recession Odds Fall With Fed Rate Cut, But Are Still Elevated
