New Indicator Suggests 40 Percent Chance US Is in Recession

Economists released a new paper that builds on the widely watched Sahm rule.

U.S. $1 banknotes are seen in front of a stock graph in this illustration taken on Feb. 8, 2021. Dado Ruvic/Reuters

A new recession indicator has been born, and it suggests a 40 percent chance the U.S. economy could be in a downturn.

Pascal Michaillat and Emmanuel Saez, economists at the University of California, recently published a paper outlining the details of the new recession signal, which adds another layer to the concept known as the Sahm rule.