This is the daily update for today, March 3, 2026.
One word that discribes the US economy:
Overall probability: low-to-moderate, closer to low in the near term. Several real-economy indicators remain resilient — industrial production and many measures of consumer spending and retail sales are positive year-over-year, total nonfarm payrolls posted solid gains recently, and financial-stress gauges are subdued. The model-based Smoothed Recession Probability is very low (well under 1%), which aligns with these healthier signals.
However, there are clear warning signs that raise downside risk over the next 6–12 months. The yield curve has flattened to well below the 1.0-point cushion typically seen before recessions, M2 growth is below the 5% warning level, real personal income has decelerated toward concerning territory, and housing permits have been weak — all typical early signals of slowing activity. In short: recession does not look imminent given current data, but the mix of a flattened yield curve, weakening income and housing data means the outlook warrants close monitoring; a sustained deterioration in these leading indicators would materially raise the recession probability.
Text written with ChatGPT from OpenAI.