TechFlow News, March 17: According to JINSHI Data, Mark Zandi, Chief Economist at Moody’s—one of the “Big Three” U.S. credit rating agencies—warned on March 17 that the U.S. economic outlook will continue deteriorating as long as the Strait of Hormuz remains effectively closed to oil tanker traffic; if the situation does not change within weeks, a U.S. recession will become unavoidable.
Zandi noted that, prior to the outbreak of conflict involving Iran, Moody’s machine-learning-based leading indicator had already signaled a 49% probability of a U.S. recession over the next 12 months; the next update is expected to reach or exceed 50%. He also emphasized that, with the exception of the pandemic period, every U.S. recession since World War II has been preceded by a sharp surge in oil prices. The current situation differs from 2022—when the U.S. economy was still riding a post-pandemic stimulus-driven growth cycle, providing the Federal Reserve with a buffer to raise interest rates aggressively; today, however, the U.S. economy lacks such support, with weak labor market data and GDP growth in Q4 2025 standing at just 0.7%.
Currently, multiple investment banks still maintain their recession probability estimates between 30% and 40%. Recently, Yardeni Research raised its market crash probability estimate from 20% to 35%. The S&P 500 Index rose 1% on Monday, closing at 6,699.38; overall, Wall Street has yet to price in a recession.
