Will the USA Enter a Recession in 2025? Economic Forecast Betting

As 2025 unfolds, the question looming large over markets, businesses, and households is whether the United States economy will tip into a recession. Economic indicators offer conflicting signals, and expert opinions diverge sharply. Amidst this uncertainty, BEO Betting Odds provide a snapshot of market sentiment, currently suggesting a greater than even chance that the US will experience an economic downturn this year.

BEO Betting Odds Points to Recession as Likely

According to the latest data from BEO Betting Odds, the probability of the USA entering a recession in 2025 stands at 57%, translating to betting odds of 1.75. This suggests that bettors, weighing the available economic data and forecasts, see a downturn as the most probable outcome for the year. These odds reflect significant concerns about slowing growth, persistent inflation pressures, and the potential impact of geopolitical or policy shifts. For those following market predictions, these figures indicate a prevailing cautiousness about the near-term economic future.

For the most current odds, visit betentodds.com.

Related

Donald Trump to Win Time Magazine’s 2024 Person of the Year?

Runner-Up: No Recession Still a Possibility

While the odds favor a recession, the alternative scenario – the US avoiding a recession in 2025 – remains the clear runner-up according to BEO Betting Odds. This indicates that a significant portion of the market believes the economy possesses enough resilience to navigate current challenges. Factors supporting this view might include a still-strong labor market, resilient consumer spending, or hopes for effective policy interventions.

Expert Predictions Offer Mixed Views

Expert forecasts paint a complex and often contradictory picture. The Conference Board’s Leading Economic Index (LEI), a key predictor of economic trends, has declined in 15 of the past 18 months, signaling a notable growth slowdown. Echoing this concern, a recent Reuters poll found economists place the likelihood of a US recession within the next year at 45%, the highest level since December 2023.

Some experts are far more pessimistic. Torsten Slok, chief economist at Apollo Global Management, assigns a 90% probability to a “Voluntary Trade Reset Recession,” criticizing recent trade policies and warning that small businesses, lacking capital to absorb tariffs, will be hit particularly hard, potentially leading to bankruptcies among established retailers. Ray Dalio, founder of Bridgewater Associates, also expressed worry, stating the economy is “very close to a recession” and potentially something worse if not managed carefully. Similarly, former Treasury Secretary Lawrence Summers estimates a “six in 10 or better” chance of a recession starting this year.

However, not all forecasts are dire. Bank of America CEO Brian Moynihan stated his bank’s baseline forecast does not include a recession this year. Other major banks show divided outlooks: Morgan Stanley sees 40% odds, Goldman Sachs places the likelihood at 45% over the next year, while JPMorgan Chase projects a higher 60% chance. Offering a strongly optimistic counterpoint, National Economic Council director Kevin Hassett declared he is “100% not” expecting a recession in 2025, suggesting tariff uncertainties won’t significantly drag down the economy based on recent CEO discussions.

Final Thoughts: Uncertainty Reigns

While BEO Betting Odds currently lean towards a recession in 2025, the economic outlook remains highly uncertain. Expert opinions range from near certainty of a downturn to complete confidence in continued growth. As the year progresses, incoming economic data and policy developments will be crucial in determining whether the US economy succumbs to recessionary pressures or manages to sustain its expansion. For now, it remains a closely watched situation with no clear consensus.