Are we in a recession or not? Are you confused about whether the US economy is in a recession?

Are we in a recession or not? Are you confused about whether the US economy is in a recession?

Updated on July 30, 2022 12:33 PM by Ava Sara

Gross domestic product!

The job market remains firm, telling the economy is still robust. It is a crucial measure of economic output that shrank for the second quarter this week. There are two consecutive quarters in a technical recession where 10 out of the last ten times, the US economy shrank for two straight quarters.


Business inventory plays a key role in the swings of the economy. Last year, businesses stocked up on goods to avoid supply chain woes and anticipate post-Covid consumer demand. GDP contracted at an annual rate of 0.9% in the second quarter.

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As of June, 98% of jobs lost during the pandemic had been recovered. The US economy has added 2.2 million jobs since January, nearly the fastest growth. The economy is creating almost 400,000 jobs a month, and paychecks in June have also grown.

Related: What do you know about the shrinking economy? America's economy is shrinking!

Inflation and rate hikes!

Higher rates keep prices in check by slowing the economy down. US consumer prices surged to a new pandemic-era peak in June, jumping by 9.1% year-over-year. Americans saved just 5.4% of disposable personal income, down from 12.4% year-over-year.

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Consumer sentiment and spending!

The most significant part of the US economy is rising consumer spending. Household spending grew in June by 1.1%, up from a revised 0.3% increase in May. The Conference Board Consumer Confidence Index decreased in July for the third month.

Yield Curve!

The shape of the yield curve is one of the most reliable indicators of the economy's health. Investors are most nervous about the immediate future than the longer term, leading interest rates on short-term bonds to move higher than those paid on long-term bonds.

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