US: Models suggest more than 70% probability of recession - BBVA

The Research Department at BBVA affirms that its model suggests there is more than 70% probability of a recession within the next two years and they see the “dovish” response from the Federal Reserve having the potential to negate downside risks in short-term.

Key Quotes: 

“Shadow banking, business debt and risk appetite represent major red flags.”

“Dovish Fed response has potential to negate downside risks in short-term.”

“Trade tensions weigh on business expectations and market sentiment.”

“Economic fundamentals for households and financial institutions remain solid”