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Recession fears surged this week as prediction market Kalshi showed a sharp jump in odds, rising to 61% following former President Donald Trump’s announcement of a sweeping new tariff order. The proposed tariffs, aimed at protecting American industries, have reignited concerns over global trade disruptions and economic fallout.
Market participants reacted swiftly, pricing in increased risks of slowed growth, higher consumer prices, and retaliatory measures from trade partners. Economists warn that while tariffs may offer short-term political gains, they often weigh heavily on long-term economic stability.
The spike in Kalshi’s recession odds reflects heightened anxiety among investors and analysts alike, as they brace for potential turbulence ahead of the 2024 election cycle. With inflation still a concern and interest rates elevated, added trade uncertainty could tip an already fragile economy toward contraction.
