Smoothed U.S. Recession Probabilities
Estimates the probability that the US economy was in recession in a given month, using a dynamic factor Markov switching model. Each reading is published about 2 months after the month it covers. Developed by economists Marcelle Chauvet and Jeremy Piger.
Current Probability
0.62%
Latest reading, Aug 2026
Smoothed recession probability at 0.62% in August, up from 0.24% in July. Still far below the 5% danger zone.
Danger zone: above 5%, the line this site uses.
Historical Data
How It Works
The model analyses four crucial economic variables:
- Non-farm payroll employment
- Index of industrial production
- Real personal income (excluding transfer payments)
- Real manufacturing and trade sales
The variables span employment, industrial production, personal income, and manufacturing/trade sales, capturing diverse economic sectors.
How to Read It
Higher percentages indicate elevated recession probability. This site uses 5% as its own early warning line. FRED does not publish a threshold for this series. This model doesn't guarantee 100% accuracy.
Why These Metrics
Broad Economic Representation: The metrics span employment, industrial production, personal income, and manufacturing/trade sales, capturing diverse economic sectors.
Data Source
FRED series: RECPROUSM156N. Updated monthly.
Credit
Developed by economists Marcelle Chauvet and Jeremy Piger.