Analysts at Nomura have a number of simple models, based on financial data, that point to a marked increase in the probability of a US recession in coming months. Key Quotes: "All the models still suggest that a recession within the next six months or a year is not the most likely scenario. However, further deterioration in financial conditions would raise the specter of a recession. We would note that recent financial market volatility may not be accurately capturing the current condition of the US economy. It is a well-established fact that financial markets are more volatile than can be justified by economic fundamental. In other words, variation in risk premia accounts for a large part of financial volatility. 2 In this context, the probabilities that come out of our financial models currently are likely upper-bound estimates." For more information, read our latest forex news.