Economists are the most skeptical they've been since 2022 about a recession striking

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Economists are the most skeptical they've been since 2022 about a recession striking
Job seekers are at a job fair in Florida in 2023.Joe Raedle/Getty Images
  • Economists place the odds of a recession this year at around 40% — the lowest since January 2022, a new Bloomberg survey found.
  • Respondents lifted their forecasts for GDP, consumer spending, private investment, and government expenditures compared to a survey last month.
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Economists are feeling more optimistic about the US economy.

In a new Bloomberg survey, economists place the odds of a recession this year at around 40% — the lowest since January 2022.

Those hopes of dodging a downturn largely rest on the strength of the job market and robust spending. The respondents lifted their forecasts for GDP, consumer spending, private investment, and government expenditures compared to a survey last month.

The 72 surveyed conomists expect year-over-year consumer spending to grow about 1.9% as opposed to the 1.5% forecasted last month. GDP outlook rose to 2.1% compared to 1.5% in the last survey.

As for the labor market, economists now see unemployment peaking at 4.1% later this year instead of the 4.2% predicted last month. They also expect employers to add more jobs to the economy through 2026.

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Recent data has already been promising. Consumer spending last month came in hot, rising 0.7% year-over-year. GDP growth also beat expectations in the fourth-quarter last year, notching an annualized growth rate of 3.3%, above the expected 2%. Further, the unemployment rate sits near historically low levels, at 3.7%.

Surveyed economists had placed a 65% chance the economy tipped into a downturn back in early 2023, but the picture has dramatically changed since then.

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