The odds of the U.S. economy falling into a recession jumped sharply, according to the latest UBS aggregate measure.
The probabilities of a recession looking at July hard data and credit data and August daily rates rose to 60%, up from 40% in June, economist Pierre Lafourcade and team wrote in a note Tuesday.
The latest hard data showed a 94% chance of the economy is in contraction, up from 35% in April "but in the current case, the US team's modal forecast is that the contraction does not morph into a full-blown recession," Lafourcade said. "The contributions of the components to the factor over the past few months are mixed: in July, labor and
housing data pulled the factor down, but industrial production and household spending actually held it up."