Resolution criteria

The market resolves YES if the National Bureau of Economic Research (NBER) Business Cycle Dating Committee officially declares that a recession occurred at any point between January 1, 2026 and December 31, 2029. A recession is defined as a significant decline in economic activity that is spread across the economy and lasts more than a few months. The NBER's approach is retrospective and may take several months to announce official peak and trough dates. The market resolves NO if no recession is declared by the NBER by the end of 2030.

Resolution source: NBER Business Cycle Dating Committee

Background

Current forecasts estimate a 35% probability of recession in 2026, though most forecasters believe the economy will not enter a recession this year despite some headwinds. Deloitte projects real GDP will decline 0.2% in 2027 and grow just 0.8% in 2028, with a stronger recovery expected in 2029 and 2030. Key risks include tariff impacts, immigration policy changes, and potential weakness in business investment if AI spending momentum slows.

Considerations

The NBER typically waits several months after a recession actually occurs before officially announcing it, meaning any recession occurring late in 2029 may not be formally declared until 2030 or later. Additionally, not all NBER-identified recessions consist of two consecutive quarters of declining GDP—the 2001 recession, for example, did not include two consecutive quarters of decline.