JP Morgan model puts odds of recession in next 2 years at over 50%

The odds that the US economy will slide into a recession in 2019 are high, standing at about roughly 28%, according to the results of a model used by JP Morgan.

According to Bloomberg, which cited a research note from the investment bank's analysts issued earlier in the week, over the next two years the probability rises to over 60%, increasing past 80% for over the next three years.

On a two-year horizon, the odds were better than 50:50.

For some economists, even a recession risk greater than 20% is already significant.

JP Morgan's model reportedly relied on multiple indicators, including measures of consumer and business sentiment, of prime-age male labour participation, compensation growth, and durables and structures as a share of gross domestic product.

As of 30 September, a separate 'model' derived by the Federal Reserve bank of New York, and based on the interest rate spread between three-month US government Treasury bills and 10-year Treasury notes was assigning odds of 14.5% to an economic recession in the US over the next 12 months.