Journal Article

Recession Signals: The Yield Curve vs. Unemployment Rate Troughs


Abstract: In early May 2018, The Wall Street Journal asked professional forecasters to predict when the next recession would begin. Nearly 6 in 10 answered that the next recession will begin sometime in 2020. If so, the current business expansion will have eclipsed the 1991-2001 expansion as the longest on record. Economists and policymakers look at several leading indicators when attempting to predict a slowdown or outright contraction in economic activity. Two stand out: the slope of the yield curve and the direction of the unemployment rate. The purpose of this essay is to ascertain the predictive power of these two economic indicators.

https://doi.org/10.20955/es.2018.16

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Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Economic Synopses

Publication Date: 2018

Issue: 16

Pages: 1-3