NY Fed Recession Probability Model
Track the New York Fed's recession probability model based on the 3-month/10-year Treasury spread. Exceeding 50% has preceded every recession since 1972.
Current Value
Trigger Level: >50% has preceded every recession since 1972
Historical Trend
AI Analysis
Today's NY Fed Recession Probability stands at 3.6%, showing a slight increase from 3.5% on May 25, 2026, but remaining well below the critical 50% threshold that signals recession risk. Over the past 90 days, the indicator has fluctuated significantly, peaking at 10.6% on June 30, 2026, before sharply declining to its current level, indicating a clear downward trend and stabilization in recession risk. This trend suggests a low and declining risk of recession, as the probability remains far below levels that historically precede economic downturns. The recent stabilization around 3.6% reinforces a safe economic outlook, with no immediate signs of recession on the horizon.
What is the NY Fed Recession Prob?
The NY Fed recession probability model uses the spread between the 10-year Treasury yield and the 3-month Treasury bill rate to calculate the probability of a U.S. recession in the next 12 months, using a probit model estimated from data since 1959.
Why It Matters for Recession Risk
This is the most established academic recession probability model. When the estimated probability exceeds 50%, it has historically preceded every recession since 1972 with remarkable reliability.
Historical Context
The model estimated recession probability exceeded 70% in 2023 during the prolonged yield curve inversion. Prior peaks above 40% in 2006 and 2000 correctly preceded those recessions.
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