Recession Risk 34/100 — November 13, 2026

Recession Risk Score: 34/100 — MODERATE (-4 vs 30 days ago)

Today’s Recession Risk Score is 34/100 (MODERATE), down 4 points versus 30 days ago (from 38 on Oct 14, 2026 to 34 on Nov 13, 2026). The big picture remains a “slowdown without a labor break” regime: high-frequency labor stress is still muted, even as housing and select cyclicals stay soft. The score drift lower reflects improving classic recession precursors (notably the yield curve), offset by a renewed inflation/fed-path tail risk. Bottom line: risk is not elevated, but the economy is increasingly vulnerable to policy-error and rate-sensitive sector spillovers.

Score Trend — Last 30 Days

The last 30 days show a moderate-risk band that is choppy but mean-reverting lower. The window runs Oct 14 → Nov 13, with Start 38, End 34 (Δ -4), Min 33, Max 46, and Avg 37 across 31 samples. That distribution matters: we briefly flirted with a higher-risk reading (the 46 peak), but the system repeatedly failed to “hold” those highs—suggesting shock sensitivity rather than a broad-based deterioration.

The last 10 readings underscore the pattern: we oscillated between mid-30s and high-30s before settling back to 34 (Nov 12: 34; Nov 13: 34). The dip to 33 on Nov 11 looks like a temporary low rather than a breakdown, implying the system is stabilizing—not accelerating toward imminent recession. The practical implication: recession odds in the next ~90 days remain constrained unless we see a clear labor-market inflection (claims trend + insured unemployment rate) or a credit shock (spreads + bank/liquidity stress).

Key Drivers

1. Labor market “no-fire” confirmation (still strong)

   • Initial jobless claims: 200,000 (week ending Nov 7, 2026) and insured unemployment rate: 1.1% (week ending Oct 31, 2026) remain consistent with low layoff intensity. (dol.gov)
   • This is the single biggest reason the score sits in MODERATE, not HIGH: recessions typically need labor deterioration to propagate.

2. Yield curve no longer inverted (classic near-term risk signal easing)

   • The 2s10s spread is +24 bps on Nov 12, 2026 (2-year ~4.86%, 10-year ~5.10%). (yieldcurvestoday.com)
   • A positive slope doesn’t “guarantee” safety, but it materially reduces the probability of a near-term recession signal compared with inversion regimes.

3. Inflation re-acceleration → Fed path risk rising (policy-error channel)

   • October CPI printed hotter than expected: headline CPI +0.4% m/m vs. +0.3% expected, with core +0.3% m/m again. (apnews.com)
   • Fed Governor Christopher Waller explicitly flagged that a 50 bp hike should be considered at the December meeting if core inflation runs around 0.3% or higher—which is essentially what the October report delivered. (federalreserve.gov)
   • Mechanically, this increases recession risk not “now,” but via tightening financial conditions into early 2027.

4. Housing is the clearest cyclical soft spot

   • Existing-home sales slumped in October to the slowest pace since August 2010 (more than 16 years). (apnews.com)
   • Mortgage rates remain restrictive: Freddie Mac 30-year fixed averaged 7.11% as of Nov 12, 2026 (fourth straight weekly decline, but still high). (freddiemac.com)
   • This combination suppresses turnover, affordability, and housing-linked consumption.

5. “Micro-leading” cracks persist (temps/freight) without broad spillover—yet

   • Temporary help services (DANGER) and freight (DANGER) remain weak in your dashboard, consistent with a goods/industrial cooling that often precedes broader labor softness.
   • The key nuance: these are leading signals; they raise conditional risk, but the system will not re-rate sharply higher without confirmation in claims/unemployment.

Category Breakdown

Using your CATEGORY BREAKDOWN counts:

• Primary Indicators (3 safe / 5 watch / 1 danger): Mixed but not recessionary—primary macro isn’t flashing “break,” though watch signals suggest late-cycle fragility.
• Secondary Indicators (2 safe / 0 watch / 1 danger): Limited breadth; secondary stress exists but is not systemic.
• Housing & Construction (0 safe / 0 watch / 2 danger): The most consistently weak category; housing remains a principal drag and the most plausible near-term transmission mechanism into broader growth.
• Business Activity (2 safe / 1 watch / 0 danger): Still constructive overall; this reduces the odds of an imminent broad contraction.
• Consumer Credit Stress (1 safe / 2 watch / 1 danger): Pressure building at the margins—watch this for lagged effects as higher rates reset household cash flows.
• Market Signals (6 safe / 3 watch / 5 danger): Risk appetite and index levels look “safe,” but valuation/ratio-style danger signals point to vulnerability if rates reprice higher.
• Liquidity (0 safe / 1 watch / 2 danger): Liquidity is a quiet tail risk—stable until it isn’t; depletion dynamics matter more than level.
• Real-Time / High-Frequency (0 safe / 1 watch / 1 danger): Real-time is not cleanly recessionary; it’s split—exactly consistent with a MODERATE score.

Biggest Movers

Top 5 by absolute 7-day % change (and what they imply):

1. ON RRP Facility: +285.7% (7D)

   • Contradictory / ambiguous. A rising facility balance can signal more cash parking at the Fed (or technical liquidity shifts). In your dashboard it’s still labeled WARNING given depletion/low level dynamics, so treat as a plumbing tell, not a direct recession trigger.

2. Freight Transportation Index: +76.9% (7D)

   • Contradictory (improving). Still in DANGER territory, but the sharp improvement suggests the goods side may be bottoming or at least stabilizing—worth monitoring for confirmation in industrial production/new orders.

3. Yield Curve (2s10s): -19.5% (7D)

   • Confirmatory (worsening, at the margin). The curve remains positive, but the spread narrowing implies the “all-clear” from steepening is not persistent. If narrowing continues while growth expectations soften, this can reintroduce recession signaling.

4. VIX: +17.4% (7D)

   • Confirmatory (worsening). Volatility picking up is consistent with a market re-pricing of Fed path / inflation risk. Not panic, but it tightens conditions at the margin.

5. Yield Curve (2s30s): -8.1% (7D)

   • Confirmatory (slightly). A flatter long-end slope can reflect term-premium/growth uncertainty—again, not recessionary alone, but consistent with late-cycle dynamics.

90-Day Indicator Trends

Important limitation: the “90-day history” you provided is not complete through Nov 13, 2026 for many series (several end around mid‑September). Where possible, I compare the historical snapshots you provided plus today’s current reading.

Labor / real-time

• Initial claims: in the history window, claims improved from ~209K (Aug 15) to ~203K (Aug 28–Sep 3) and sat near 206K (Sep 4 onward in the snippet), while today’s narrative has 200K for Nov 7 (still exceptionally low). Net: no sustained uptrend, no propagation.
• Unemployment rate: held at 4.1% throughout the provided window and remains 4.1% today—flat, consistent with the Sahm Rule at 0.00 (not triggered).

Growth / activity

• Industrial Production index: rose from about 102.6 (Aug 15) to 103.0 (late Aug / early Sep in the snippet), and stands 104.0 today—a clear uptrend (directionally pro-growth).
• ISM manufacturing: you referenced October manufacturing expansion; the ISM report confirms manufacturing expanded in October for the 10th consecutive month, and the Production Index rose to 59.0 (highest since Nov 2021). (ismworld.org)
  Net: business activity signals are not recession-confirmatory right now.

Financial conditions / credit

• HY OAS (credit spreads): the history shows ~271 bps (Aug 15) easing down toward ~260 bps (Sep 1), while today’s reading is 334 bps—a material widening versus the late-summer baseline. That’s not “blowout,” but it’s directionally negative and consistent with higher policy-error risk.
• NFCI: stayed around -0.55 to -0.56 in the history—generally “near normal / easy-ish” conditions; today you have -0.46 (still not tight, but less easy).

Housing

• Housing starts: fell from 1427K (Aug 15) to ~1239K (Aug 19 onward in the snippet) and your current reading is 1221K—a sustained lower plateau. This is a persistent late-cycle negative rather than a sudden collapse.

Valuation / market-risk asymmetry

• Indices remain near highs in today’s snapshot, but the “market vs. economy” ratios (S&P500/GDP, NASDAQ/GDP) remain elevated/dangerous in your dashboard—suggesting fragile equilibrium: growth is okay, but equity pricing assumes a lot of future perfection. If the Fed tightens faster, that gap can close quickly (via valuation compression).

Stock Screener Signals

Today’s quant flags cluster into two buckets: high-yield “value dividend” names (financials/telecom/consumer cyclicals) and oversold growth.

First, the value dividend grouping ($ARCC, $AIG, $FNF, $T, $BBY, $HMC, $BCE, $LTM) is a classic late-cycle posture: investors screen for cash flow, payout, and lower multiples when macro uncertainty is rising. In recession-risk terms, that’s consistent with a market that is not pricing an imminent contraction (indices are high), but is quietly hedging with “paid-to-wait” exposures.

Second, the oversold growth names ($CHTR, $TLK) with low RSI readings suggest selective stress in rate-sensitive or leverage-sensitive business models. That aligns with today’s macro mix: policy-rate uncertainty is the swing factor. If markets begin to believe in a 50 bp December hike (or a longer hiking campaign), the discount-rate channel disproportionately hits leveraged/long-duration equities—often before it shows up in unemployment.

One more note: several displayed dividend yields look mechanically implausible (e.g., triple-digit yields), which often indicates data/vendor quirks (special distributions, trailing anomalies, or price/dividend mismatches). The macro interpretation still holds—your screener is capturing a defensive/value tilt plus select growth stress.

Latest Economic Developments

• Jobless claims remain historically low. The U.S. reported 200,000 initial claims for the week ending Nov 7, 2026, with an insured unemployment rate of 1.1% (week ending Oct 31). (dol.gov)
  This keeps recession risk contained in the near term because it signals employers are still hoarding labor.

• Inflation surprised hotter; Fed rhetoric turned more hawkish. October CPI rose 0.4% m/m (faster than expected), while core held at 0.3% m/m. (apnews.com)
  Fed Governor Waller explicitly tied a “stronger” move to core inflation at ~0.3% or higher and said a 50 bp hike should be considered for December under that condition. (federalreserve.gov)
  Markets also repriced on the CPI surprise; equities fell on Nov 10 as rate expectations rose. (apnews.com)

• Housing remains under pressure even as mortgage rates tick down. Freddie Mac’s 30-year fixed rate averaged 7.11% as of Nov 12, down from 7.18% the prior week. (freddiemac.com)
  Meanwhile, existing-home sales in October fell to the slowest pace since Aug 2010, emphasizing that affordability and lock-in effects are still binding. (apnews.com)

Near-Term Outlook (Next 30 Days)

The next month is primarily about whether hot inflation data hardens into a faster Fed path—and whether that tightening shows up in credit and labor.

Base case (most likely):

• Risk score stays in the low-to-mid 30s (MODERATE), with modest day-to-day volatility driven by rates and risk sentiment. Labor indicators should remain stable unless a negative shock hits corporate margins.

Key near-term catalysts:

• Weekly jobless claims prints (Nov 14–Dec 5 weeks): the threshold to watch is not one print, but a persistent drift higher (e.g., repeated weeks >220K plus a rising insured unemployment rate).
• Nov 25, 2026 inflation data (PCE / inflation follow-through): confirmation of sticky core inflation would increase odds of a larger December hike (and raise recession risk via tightening).
• Credit spreads and bank/liquidity stress: if HY OAS widens meaningfully from today’s ~334 bps and bank stress metrics worsen, the model should re-rate upward even before unemployment moves.

Long-Term Outlook (3-6 Months)

Over the next 3–6 months, the macro regime looks like late-cycle expansion with rising downside asymmetry.

• Why recession is not “base case”: labor remains tight (claims low, insured unemployment rate low), industrial output is expanding, and business activity indicators (like ISM production strength) are inconsistent with an imminent contraction. (ismworld.org)
• Why risk is not “low”: inflation persistence raises the probability the Fed overtightens into a fragile housing/credit structure. Housing already looks like the weak link (existing-home sales at 2010-like lows), and valuation-sensitive markets can transmit tightening quickly via wealth effects. (apnews.com)

Historical parallel (mechanism, not prediction): late-cycle periods where housing weakens first and labor lags can run longer than expected—until a policy/credit shock forces layoffs. The model’s current posture (MODERATE, drifting slightly down) implies watchful waiting: the system sees fragility, but not yet the trigger.

What to Watch

High-frequency “tripwires” (weekly):

• Initial claims: sustained move >220K and rising 4-week average
• Insured unemployment rate: a rise from 1.1% toward 1.3%+
• HY OAS: widening beyond ~400 bps would be a meaningful regime shift
• VIX: sustained >25 would indicate materially tighter financial conditions

Macro “confirmation points” (monthly/quarterly):

• Inflation follow-through (core CPI / PCE): repeated 0.3%+ prints keep December “jumbo” risk alive
• Housing starts/permits: further declines confirm a deepening rate-sensitive slowdown
• Consumer stress: delinquencies + savings rate—watch for a nonlinear break where consumption rolls over

Sources

No data available for this window.