Recession outlook: What the Sahm Rule says about the labor market and the U.S. economy

Описание: Known economic indicators are being peered over more closely as recession risks whirl around the US economy. Sahm Consulting Founder Claudia Sahm joins Yahoo Finance Live as part of its Chartbook series to discuss the labor market and the "Sahm Rule" named after her, which is said to measure whether a recession is ahead or not.
According to the former Federal Reserve Board economist, the rule states that an indicator of a recession is a “three-month moving average of national unemployment relative to its low during the previous twelve months.” Sahm states that based on the rule, currently “we are not in a recession.”
Taking a closer look at the labor market, Sam notes that there were “a lot of disruptions,” and stabilization “takes time.” Sahm believes that although the Federal Reserve is “dragging their feet,” a rate cut is to be expected. Sahm expects the Fed to be cautious but predicts that believers in early-March interest rate cuts will be “disappointed," ahead of the Fed announcement on Wednesday, January 31.

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