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  • Writer's pictureJulie Skye

U.S. Recession Model at 100% Confirms Downturn Is Already Here

The novel coronavirus has spurred what will likely be the worst recession in generations as the U.S. economy grinds to a halt and millions lose their jobs.

100% Chance of Recession Within 12 Months

Bloomberg Economics created a model last year to determine America’s recession odds. The chance of a recession now stands at 100%, confirming an end to the nation’s longest-running expansion. While much of the economic data that feed into the model continues to lag, filings for unemployment benefits — which are reported with less than a week’s delay — saw an unprecedented increase at the end of March. About 10 million jobless claims were filed in the last two weeks of the month, underscoring a sharp deterioration in the once-vibrant labor market.

Recession is Here--Probability of U.S. recession within 12 months The recession probability model developed by Bloomberg economists Eliza Winger, Yelena Shulyatyeva, Andrew Husby and Carl Riccadonna incorporates a range of data spanning economic conditions, financial markets and gauges of underlying stress.

The surge in the recession probability mainly reflects the shocking jobless claims figures, but plummeting stock prices for much of the month also played a role. The model's reading on the odds for February came in at 33%. At the time of the prior report, Bloomberg Economics took account of early financial market data for March, putting the odds at 53%.

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