Official recession calls are the responsibility of the NBER Business Cycle Dating Committee, which is understandably vague about the specific indicators on which they base their decisions. This committee statement is about as close as they get to identifying their method.

There is, however, a general belief that there are four big indicators that the committee weighs heavily in their cycle identification process. They are:

• Nonfarm Employment
• Industrial Production
• Real Retail Sales
• Real Personal Income (excluding Transfer Receipts)

The Latest Indicator Data

Month-over-month nominal sales in February decreased by 3.0%. Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, decreased by 3.4%.

The chart below gives us a close look at the monthly data points in this series since the end of the last recession in mid-2009. The linear regression helps us identify variance from the trend.

We see that this indicator has been rising below trend since the end of 2015.

The Generic Big Four

The chart and table below illustrate the performance of the generic Big Four with an overlay of a simple average of the four since the end of the Great Recession. The data points show the cumulative percent change from a zero starting point for June 2009. We will update this chart and table to reflect the current recession when a real trough is confirmed as there may be more in store. The NBER also does not define a trough until the recession is well over - of which we are still currently in.

Assessment and Outlook

Here is a percent-off-high chart based on an average of the Big Four. The average of the four set a new all-time high in November of 2018. We extrapolate the figures that have yet to be released for the month to determine whether we've hit another all-time high once that data is fully released.

The next update of the Big Four will be the latest read on Personal Income for February.