Checking recession claims

Wells Fargo Research Team Wells Fargo

Summary

Initial jobless claims have been trending higher since early April in one of the clearest signs that labor market conditions have begun to deteriorate. While jobless claims have a successful track record foreshadowing recession, we find continuing claims to be a better check on whether the economy is already in one. The recent trend in continuing claims adds weight to the argument that the economy is not currently in recession. That said, the recent uptick bears some resemblance to the months that preceded prior recessions, suggesting that the start of a recession may not be far off.

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Wells Fargo Research Team

Wells Fargo

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