Are We in a Recession?

Tariffs have roiled global trade in the past year and the ongoing war in Iran has raised new worries, but the U.S. is not currently in a recession, according to a traditional definition.

Most recently, the U.S. economy suffered a deep but very short recession at the onset of the pandemic in 2020, according to the National Bureau of Economic Research. In fact, it is the shortest on record, lasting only two months, March and April, before giving way to an expansion that began in May that year.

That expansion has since stumbled at times, and inflation has been persistent even after coming down from its peak of 9.1% in June 2022.

Economic growth was sporadic in 2025, and was actually negative in the first quarter before rebounding strongly in the second and third quarters, then slowing to a 0.5% annual rate in the fourth quarter. In the first quarter of 2026, GDP rebounded to a 2.1% annual growth rate.

The definition of a recession

Essentially, a recession happens when growth stops and the economy begins to shrink. The conventional benchmark has been that two consecutive quarters of a generally slowing economy defines a recession. A depression is also an economic contraction, but is generally defined as being longer and more severe, with economic impacts that are more widespread.

How long do recessions last?

Historically, recessions have lasted anywhere from months to several years, according to the National Bureau of Economic Research. Some recessions are mild and may end quickly, while others have lingering effects even after they’ve technically ended.

The recession during the covid lockdown in spring 2020 lasted only two months. The longest U.S. recession ever began in 1873 and lasted more than five years. The Great Depression was the second longest, lasting from 1929 to 1933.

Since 1948, the so-called start of the modern era, there have been 12 recessions. The most defining recession of the 21st century was the Great Recession, which began in 2007 and ended in 2009.

Will there be a recession in 2026?

President Donald Trump’s tariff actions, beginning in spring of 2025, disrupted global trade and sparked several recession predictions, but in the end a recession was avoided. The war in Iran is generating new fears of a potential global recession.

Here is a sampling of those who have addressed the possibility of a recession.

International Monetary Fund (IMF)

The IMF releases its extensive World Economic Outlook twice annually. Its most recent report, released in April 2026, noted that the global economy had weathered “higher trade barriers and elevated uncertainty” in 2025, but is now challenged by the war in the Middle East. The report projected slower growth and higher inflation in 2026, and raised the possibility of a global recession under certain “severe” scenarios stemming from the conflict.

Mark Zandi, Moody’s Analytics chief economist

Moody’s Analytics Chief Economist Mark Zandi says that a reliable indicator of recession risk, called the “Vicious Cycle Index,” was triggered in January 2026 — raising the possibility that the economy is already in recession.

“It could still be wrong,” Zandi wrote on LinkedIn. “These are highly unusual times and we have yet to see consumers pull back significantly or businesses begin widespread layoffs.” Nevertheless, economists are concerned about the labor picture, and are watching business cycle data closely.

Consumer sentiment measures

Fears of a recession can actually be self-fulfilling, as consumers spend less when they have concerns about their finances. The Index of Consumer Expectations from the University of Michigan, one of the most frequently cited consumer sentiment measures, hit an all-time low of 44.1 in the May 2026 report. It was 71.7 at the start of 2025 and was regularly in the 90s or above before the pandemic.

Meanwhile, about two-thirds of Americans (65%) believe the U.S. economy will enter a recession in the next 12 months, according to an April NerdWallet survey conducted online by The Harris Poll.

Banks and investment houses sometimes publish their own assessments of recession risk. Goldman Sachs raised the probability of a U.S. recession in the next 12 months to 30% in its most recent update in March 2026.

Getting ready for a recession

Right now, the nation has not tipped into recession — and certainly not a depression, either. A depression is an extended economic breakdown, and we have not seen signs of that kind of pain. (See recession vs. depression.)

» MORE: How is the economy doing?

But economic declines begin before a recession is declared official. In other words, we may feel a recession before we know we’re in one. Economic cycles are impossible to predict, so it's best to be financially prepared.