TD Securities doesn’t think so. But it does warn that “the risks of a 2022 recession have increased after recent data, and we now see 60% odds of a recession within the next 12 months”.
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- The recent souring in economic data has raised fears of an imminent US recession. In this note, we discuss the likelihood of a “technical recession”, how this differs from a recession defined by the National Bureau of Economic Research (NBER), and why we believe that a technical recession may be
obscuring strong underlying growth in the near-term. - We continue to judge that the US economy is currently not in recession even if GDP growth turns out to be negative in Q2. However, the risks of a 2022 recession have increased after recent data, and we now see 60% odds of a recession within the next 12 months.
- We are now looking for GDP growth to slow further by the end of the year and into the beginning of 2023. That said, we expect the Fed to continue tightening policy “expeditiously” to above its estimate of neutral by the end of the year despite rising recession odds and continue to see a terminal Fed funds rate of 4%.
