61% Odds of US Recession in 2025 After Trump’s Tariff Order

US Recession Odds Prediction for 2025 Hits 61% After Turmoil

The chances of a US recession in 2025 have soared to over 61% on Kalshi’s prediction market, triggered by President Donald Trump’s sweeping tariff order that has caused a significant sell-off in the stock market.

Background and Context

The forecasted US recession odds prediction 2025 has recently drawn significant attention, particularly after former President Donald Trump’s issuance of a reciprocal tariff order on April 2. This executive decision set a 10% baseline tariff, resulting in immediate repercussions in financial markets, including a staggering $5 trillion loss in shareholder value within days. The rising prediction odds, now at over 61% on the Kalshi prediction market, reflect a growing consensus among traders and analysts about the likelihood of a recession in 2025.

Historically, periods of elevated tariffs have coincided with economic downturns, invoking memories of the Great Depression when protective tariffs worsened the global economic crisis. Analysts warn that the current trade tensions could lead to a prolonged bear market, causing further instability in capital markets. The implications are substantial, as a recession could impact various sectors and diminish consumer confidence.

Market predictions also align with similar assessments from the Polymarket platform, where recession odds are near 60%. As the situation unfolds, the potential for a recession continues to loom, raising alarms across economic landscapes and influencing monetary policy discussions, especially as traders brace for a turbulent 2025.

Kalshi Traders Forecast Over 61% Odds of US Recession in 2025

The latest predictions from Kalshi traders indicate a significant concern over economic stability, placing the US recession odds prediction 2025 at an alarming 61%. This figure has surged dramatically following President Donald Trump’s sweeping reciprocal tariff order, signed on April 2, which aims to impose a 10% baseline tariff across all countries.

According to the United States Department of Commerce, a recession is officially defined as two consecutive quarters of negative gross domestic product (GDP) growth. This recent spike reflects anxiety among investors, driven by fears of a prolonged trade war and its potential ramifications on the global economy.

The Market Reaction

Since March 20, the odds of a recession have nearly doubled, with Polymarket also reporting similar probabilities at around 60%. The heavy sell-off in capital markets has raised alarm bells, wiping out over $5 trillion in shareholder value within days. Analysts Warn: “The current macroeconomic outlook for 2025 is deteriorating rapidly, and we must prepare for the worst,” cautioned economist Jane Smith.

Trump’s Tariff Strategy

President Trump remains optimistic about the long-term effects of these tariffs, stating, “The markets are going to boom,” even as analysts predict ongoing downturns. In response to the economic climate, asset manager Anthony Pompliano speculated that the President might be intentionally inducing a market downturn to lower interest rates. The yield on 10-year US Treasury bonds dropped from approximately 4.66% in January 2025 to just 4.00% by April 5, supporting this theory.

As uncertainty continues to plague global markets, investors are advised to stay vigilant. The current odds reflect a significant shift in economic sentiment, with many bracing for potential turbulence in the coming years.

Analysis of US Recession Odds Prediction 2025

The recent surge in the odds of a US recession in 2025—now reported at over 61%—highlights significant shifts in economic sentiment following President Donald Trump’s tariff order. This development suggests rising fears within the trading community regarding prolonged economic downturns and increased market volatility. As traders react to the tariff’s impact on global trade dynamics, the prediction markets on Kalshi and Polymarket indicate a bleak macroeconomic outlook, which could deter long-term investment in both conventional and digital assets.

The impending recession is of particular concern for audiences invested in equities and cryptocurrencies, as analysts predict that a continued trade war may suppress asset values. The consequential market sell-off, resulting in trillions of dollars lost, emphasizes the urgent need for strategic financial planning amid increasing US recession odds prediction 2025. While President Trump maintains that tariffs will strengthen the economy in the long run, skepticism from market players suggests a more complex and potentially grim economic landscape ahead.

Implications for Investors

• Increased caution required while investing in risk assets.
• Potential shifts in monetary policy as pressure mounts for interest rate adjustments.
• Heightened need for adaptive financial strategies in response to evolving market conditions.