Top economists do U-turn on recession forecasts as most now see it as unlikely in next year

• A 71% majority of economists put the odds of a recession in the next 12 months at 50% or less.
• That's according to a survey by the National Association for Business Economics.

Top economists have reversed their recession forecasts, with most now doubtful that one will occur in the year ahead.

A 71% majority of economists put the odds of a recession in the next 12 months at 50% or less, according to a survey by the National Association for Business Economics.

That includes a sizable chunk who are especially optimistic, with one-fourth saying a recession has a probability of 25% or less.

This is a turnabout from just a few months prior. In April, economists were about evenly split. And in the March NABE survey, 58% said the US was either already in a recession or that it would come sometime in 2023.

The shift in sentiment stems from broader positivity across the economy, as recent metrics demonstrate resilience and receding inflation trends.

"Results of the July 2023 NABE Business Conditions Survey reflect an economy of rising sales and profits, as materials costs decline and stabilizing wages prove less challenging," said NABE President Julia Coronado, who is also founder and president of MacroPolicy Perspectives.

In fact, for the first time since 2021, a majority said wages at their firms were steady in the second quarter. Meanwhile, the share reporting higher wages tumbled to 47% from 63% in the April survey.

The NABE data comes as others have expressed similar optimism. "Big Short" investor Steve Eisman said recently there's no indication of a downturn, and Nobel economist Paul Krugman said a soft landing is in reach.