How to model the timing of a US recession

There's been a fair bit of talk about a pending US recession. Much of this chatter has been fuelled by simple analysis of the slope of the yield curve, which is widely viewed as a strong predictor of recession. What this analysis doesn't do, however, is provide an information on the timing of when a recession might occur. The fixed income team at Schroders have developed a 24-point model that combines a range of indicators each with a 'best-fit' of time to a recession. In this short video Stuart Dear, Deputy Head of Fixed Income at Schroders, provides an example of how their recession modelling works and explains what it is telling them right now.


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