When Will the Recession Truly Arrive in America?

The threat of a recession in the United States (US) has resurfaced amid economic pressures and a surge in energy prices. However, the big question remains the same: when will the recession truly occur?

Several economists assess the current recession risk as quite high. Partner and associate director at Boston Consulting Group, Hady Farag, stated that market participants are beginning to prepare for that possibility.

“People are preparing for the reality that we are already in a recession now or there is a high likelihood we will soon be in one,” he said, as quoted by CNN International on Tuesday (31/3/2026).

This concern is exacerbated by high energy prices, which have historically often served as an early indicator of recessions. Additionally, US President Donald Trump’s economic policies, from tariffs to immigration, are seen as adding to the uncertainty.

Portfolio strategist at Richard Bernstein Advisors, Dan Suzuki, highlighted the growing market anxiety over the potential economic slowdown. “Financial markets are increasingly showing signs of fear of a recession,” he said.

Nevertheless, history shows that recession predictions often miss the mark. In the past eight years, economists have warned of potential recessions almost every year, but it only truly happened once, in 2020, when the Covid-19 pandemic triggered a brief but sharp global economic contraction.

In 2022, for instance, high inflation, a surge in oil prices due to the Russia-Ukraine war, and aggressive interest rate hikes by the US central bank convinced many that a recession was inevitable. Even Bloomberg’s model once projected a 100% chance of recession in the next 12 months. Yet, the US economy held firm until 2025.

This phenomenon has given rise to several theories. One is the “rolling recession,” where weakness occurs only in certain sectors, while others continue to grow.

Dean of the business school at Notre Dame de Namur University, John M. Veitch, explained that this condition makes the recession feel uneven. In fact, it may have already occurred several years ago.

“People ask when the recession will come. If you are in the high-tech sector, it happened three years ago,” he said, referring to the pressures in the technology sector in 2022.

Additionally, the “K-shaped” theory indicates that high-income groups remain able to spend, thereby supporting overall consumption even as low-income groups face pressure.

There is also the factor of “front-loading expenditure,” where the threat of tariff policies prompts businesses and consumers to accelerate spending before the policies are implemented, thus supporting economic growth in the short term.

Meanwhile, EY-Parthenon’s Chief Economist, Greg Daco, estimates the current probability of a US recession at around 40%. This risk could rise significantly if geopolitical conflicts, particularly in the Middle East, worsen.

“There is a real risk of recession,” said Long. “But you don’t want to be the economist who predicts disaster.”

With the various uncertainties in place, the US economy is now seen as at a crossroads. Although signs of slowdown are increasingly visible, the long-predicted recession has yet to truly materialise.