WSJ Survey: US Recession Risks Fade as Inflation Persists

Key Facts

In a move reflecting the resilience of the US economy against high interest rates, the latest Wall Street Journal survey shows a notable decline in the probability of a recession. According to the survey results, economists believe that contraction risks are gradually fading due to robust growth data. However, inflation remains a persistent challenge requiring close monitoring, as participants indicated that price stability remains elusive despite the overall improvement in economic prospects.

This cautious optimism comes at a time when international data shows diverging price pressures, with China's annual inflation rate hitting 1% in July 2026, falling short of the 1.1% forecast per market data. Conversely, recent data from Mexico showed annual inflation stabilizing at 3.37%, reinforcing the global view that the disinflationary path is not uniform across major economies. These figures support the WSJ experts' view that inflation is "sticky" and may take longer to reach targets.

Looking ahead, markets are awaiting the release of the FOMC minutes for clearer signals on monetary policy direction. Investors will also monitor US Initial Jobless Claims, which in the most recent reading stood at 215k (as of July 9, 2026), to assess the labor market's resilience in the face of persistent inflation and potential growth headwinds.