Anyone who is eager to know the answer to the question, “Will there be a recession this year?” is bound to feel frustrated and disappointed with the two most commonly given answers.
On the one hand, you’ll hear, “Yes, a recession will likely come,” which essentially means, “Recessions happen from time to time, and this bull market will wobble at some point.” The other common answer, even less definite then first, leaves you more in the dark: “No one can predict what happens to the market — your guess is as good as mine.”
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Actually, both answers aren’t wrong in a basic sense: Recessions happen, and nobody can predict the day they will arrive. But that doesn’t mean we can’t gather a general sense of where the market is heading, of whether the conditions for a recession are beginning to take shape, or if something entirely different is beginning to form. When we look at some common recession indicators, the picture today might look less ominous than investors think.
The good news
The good news is simply this: The U.S. economy is growing, employers are adding jobs, and many professional forecasters are actually very optimistic about future growth.
In the second quarter of 2026, the U.S. economy grew at an annual rate of 1.5%. True, this growth was slower than in the first quarter of 2026 (2.1%), and slower compared to the second quarter of 2025 (about 3.8%). Slow growth is something to watch keenly, but positive gross domestic product growth nevertheless shows that the economy is still expanding.
Then there’s the Conference Board’s Leading Economic Index (LEI), a widely followed gauge that looks for signs the economy might be slowing down or speeding up. At the end of August, the LEI had good news: The index rose 0.2% in July, turning its six-month growth rate positive for the first time in more than four years. Most components in the index were positive, with consumer expectations being a notable exception. The Conference Board took this as a sign that moderate economic growth could lie ahead.
Finally, the August survey of professional forecasters from the Philadelphia Fed was also positive. According to 32 forecasters, the U.S. economy seems to be in a better place than it was three months ago, with forecasts for 2.5% annualized growth in the third quarter and 2.3% in the fourth.
