Traders on the Kalshi prediction market estimate the odds of a US recession in 2025 at over 61%, following President Trump's recent tariff order. This marks a substantial increase in odds, nearly doubling since March 20, and reflects similar predictions on Polymarket, where the odds are currently at 60%. The outlook changed drastically after Trump's April 2 announcement, which implemented a baseline 10% tariff rate, resulting in significant sell-offs in capital markets that erased more than $5 trillion in shareholder value. Analysts warn that these tariff actions could lead to a prolonged bear market. Trump, however, remains optimistic, claiming that the tariffs will ultimately strengthen the economy. Analysts suggest a strategic recession could be part of a plan to lower interest rates, which have already seen notable drops. The situation highlights the tensions in trade and economic policy as the administration navigates potential financial turmoil.

Source 🔗