Fact Check: US is spiraling into a recession?

Fact Check: "US is spiraling into a recession?"

What We Know

The claim that the U.S. is spiraling into a recession has been prevalent in various media and public discussions, particularly as economic indicators fluctuate. However, recent analyses indicate that the U.S. economy has shown resilience throughout 2023. According to a report from the White House, the economy has defied early predictions of recession, with real GDP growth projected at 2.6% for the year, driven by strong consumer spending and job growth (source-2).

Moreover, the unemployment rate has remained below 4% for over 22 months, a level not seen in more than 50 years, and job gains have averaged 232,000 per month in 2023 (source-2). Inflation, which peaked in mid-2022, has been on a downward trend, contributing to a more stable economic environment (source-2).

Analysis

The assertion that the U.S. is heading into a recession lacks substantial backing when considering the current economic indicators. A report from the Federal Reserve emphasizes that while there are signals to monitor, the overall economic landscape does not suggest an imminent recession (source-1).

Additionally, the FDIC's Risk Review notes that while forecasts indicated increasing odds of a recession throughout 2023, the economy ultimately avoided a recession and showed signs of recovery (source-3).

Critically, the reliability of the sources used to support the claim of an impending recession is questionable. Many forecasts earlier in the year predicted a recession based on historical trends and economic pressures, but these predictions did not materialize as the year progressed. The Center on Budget and Policy Priorities corroborates this by stating that the U.S. economy ended 2023 with solid growth, contrary to earlier fears (source-5).

Conclusion

The claim that the U.S. is spiraling into a recession is False. Despite earlier predictions and concerns, the economic data from 2023 indicates robust growth, low unemployment, and declining inflation. These factors collectively suggest that the economy is not only stable but also recovering from previous downturns, contradicting the notion of an imminent recession.

Sources

1. PDF Recession Signals and Business Cycle Dynamics: Tying the Pieces Together
2. Ten Charts That Explain the U.S. Economy in 2023
3. PDF 2023 Risk Review - Section 2: Overview of the Economy, Financial ... - FDIC
4. U.S. Bureau of Economic Analysis (BEA)
5. Economy Strong as 2023 Ended - Center on Budget and Policy Priorities