Moody’s Analytics chief economist Mark Zandi said the probability of a U.S. recession in the next 12 months is “uncomfortably high,” pegging the risk at 48% based on recent economic data.
Key facts:
- Zandi said recession odds are 48%, the highest level historically without an actual downturn following.
- He cited declining residential building permits and rising unsold home inventories as leading warning signs.
- New permits are approaching pandemic-era lows as builders pull back on construction activity.
- Upcoming August permit data is set for release on September 17, coinciding with the Federal Open Market Committee meeting.
- Zandi expects the Fed to announce a rate cut that day but warned it may not be enough to avoid recession.
Relevant Companies
- Home Depot ($HD): Sensitive to housing activity and building permits trends.
- Lowe’s ($LOW): Exposure to weakening home improvement demand tied to slowing construction.
- Toll Brothers ($TOL): Homebuilder directly impacted by reduced permits and weaker buyer demand.
Editor’s Note: This is a developing story. This article may be updated as more details become available.
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