US recession by end of 2026: Odds & Probability
Prediction markets price the chance of a US recession before the end of 2026 at 7.5%, an unlikely reading. The probability has shifted -1.0 pts over the past day.
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With the recession outcome assigned an unlikely chance, markets strongly favor a “No” resolution; any other remote possibilities are priced near zero.
Context
The market-implied probability currently sits at 7.5%, within a range that has spanned 7.5% to 12.5%. The 24‑hour change is -1.0 pts. The market resolves to “Yes” if either two consecutive quarters of negative U.S. real GDP growth (seasonally adjusted annualized, as reported by the BEA) occur between Q2 2025 and Q4 2026 inclusive, or if the NBER publicly declares a recession at any point in 2025 or 2026 before the advance Q4 2026 GDP estimate is released. Advance estimates are considered; for example, a negative advance Q3 2025 following a negative Q2 2025 would trigger a Yes. Otherwise it resolves to “No”. The resolution sources are the BEA and the NBER. The probability will react to each quarterly GDP release and to any NBER communication, with the final resolution deadline being Dec 31, 2026. Key inputs are the BEA’s GDP estimates and NBER recession calls, as these directly determine settlement.
FAQ
What triggers a Yes resolution?
A Yes occurs if the BEA reports two consecutive quarters of negative real GDP growth (seasonally adjusted annualized) between Q2 2025 and Q4 2026, or if the NBER announces a recession during 2025–2026 before the advance Q4 2026 GDP estimate is published.
Are advance GDP estimates used?
Yes, advance estimates are considered. For instance, if the advance Q3 2025 figure is negative and the most recent Q2 2025 estimate is also negative, the market would resolve to Yes.
Does an NBER declaration alone settle the market?
An NBER recession announcement made by the time the BEA releases the advance Q4 2026 GDP estimate is sufficient for a Yes resolution, regardless of the GDP data at that point.
What if a negative quarter is later revised upward?
The market considers the latest available estimate at the time of each release. If two consecutive advance estimates are negative, that would trigger Yes, even if a prior quarter is later revised.
When does the market resolve if no recession occurs?
If neither condition is met by the resolution deadline on Dec 31, 2026, the market resolves to No after the advance Q4 2026 GDP report and any NBER assessment.
Data: Polymarket · Methodology · Not financial advice