US recession odds drop, rate cuts paused

Market indicators suggest a reduced risk of recession in the United States, with implied odds of an economic downturn by the end of 2026 falling to 28%. This reflects improved economic sentiment and data. Concurrently, expectations for Federal Reserve interest rate cuts have shifted, with analysts now forecasting a pause in monetary easing through September 2027. These projections indicate a more stable outlook for the US economy over the next two years.