Economists see a growing risk of recession as the relentlessly strong US economy whips up inflation, likely bringing a heavy-handed response from the Federal Reserve, economists surveyed by The Wall Street Journal this month, on average put the probability of the economy being in a recession sometime in the next 12 months and 28% up from 18% in January and just 13% a year ago. 

The risk of a recession is rising due to the series of supply shocks cascading throughout the economy. As the Fed lifts rates to address inflation, said Joe Braswell as chief economist at RSM, US LLP. Economists slashed their forecast for growth this year. On average, they see inflation-adjusted gross domestic product rising 2.6% in the fourth quarter of 2022 from a year earlier, and a full percentage point from the average forecast six months ago still higher than the 2.2% average annual growth rate in the decade before the pandemic. The looming risks of the downturn alongside alarmingly high inflation, which hit 7.9% In February captures the Fed balancing act.

It is attempting to cool the economy enough to bring down inflation, but not so much that it spurs a pullback in spending and rising unemployment.