Growth Regime Monitor

Hard output — real GDP, industrial production, and factory utilization. The pills read the year-over-year pace of industrial output, the cleanest monthly contraction gauge.

ContractingYoY < 0%

Slowing0–1.5%

Expanding> 1.5%

▸ Regime definitions & method

Contracting INDPRO YoY < 0% — output shrinking year-on-year; recession-coincident.

Slowing 0–1.5% — positive but fading; late-cycle territory.

Expanding > 1.5% — healthy output growth.

Real GDP (A191RL1Q225SBEA) is quarterly and lagged; industrial production and capacity utilization (TCU) are the timely monthly cross-checks. ISM manufacturing PMI currently reads — (below 50 = contraction).

Current readings

Real GDP QoQ (ann.)

—

latest quarter, %

Industrial Prod. YoY

—

INDPRO, % vs 12m

Capacity Utilization

—

TCU, % of capacity

Components · inputs

Industrial Production — Level

Real output of factories, mines and utilities. Stretches of year-on-year contraction are shaded.

Capacity Utilization (TCU)

Share of industrial capacity in use. The dashed line marks the long-run ~80% average; sustained sub-78% readings are slack-economy territory.

Synthesis · the growth pulse

Industrial Production — Year-over-Year Growth

The monthly growth pulse. Zero is the contraction line; +1.5% marks expanding / slowing. Below-zero stretches are shaded.

The labor market — unemployment, jobless claims, and the Sahm rule. The pills read the Sahm rule, the most reliable real-time recession trigger.

HealthySahm < 0.3

Watch0.3–0.5

Recession trigger≥ 0.5

▸ Regime definitions & method

Healthy Sahm < 0.3 — unemployment trend benign.

Watch 0.3–0.5 — the trend is turning; not yet triggered.

Recession trigger ≥ 0.5 — the Sahm rule fires when the 3-month unemployment average rises 0.5pp above its 12-month low; historically coincident with the start of recessions.

Initial jobless claims (4-week average) above ~280k is the corroborating stress flag; below that, the labor market is still absorbing.

Current readings

Unemployment Rate

—

UNRATE, %

Sahm Rule

—

trigger at 0.5

Initial Claims (4wk)

—

ICSA, thousands

Components · inputs

Unemployment Rate

The headline labor gauge. A rising trend off the cycle low is what the Sahm rule formalizes.

Initial Jobless Claims (weekly)

The fastest labor signal. The dashed line marks the ~280k stress threshold.

Synthesis · the recession trigger

Sahm Rule (real-time)

The 3-month unemployment average minus its trailing 12-month low. The dashed 0.5 line is the recession trigger.

The household side — real spending, sentiment, and credit-card stress. The pills read a composite of all three, so resilient nominal spending can't mask weak confidence or rising delinquencies.

Stressed≥ 2 severe

Mixed1+ weak

Healthyall firm

▸ Regime definitions & method

Consumer health is a composite of three sub-signals, each scored firm / weak / severe:

Spending — real retail sales YoY (CPI-deflated): > 2% firm · 0–2% soft · < 0% contracting. Headline RSAFS is nominal and overstates strength.

Confidence — consumer sentiment (UMCSENT): ≥ 75 · 60–75 weak · < 60 severe.

Balance sheet — credit-card delinquency level vs its own history (z-score): below avg · above avg · > 1σ elevated.

Stressed = ≥ 2 severe · Mixed = any weak/severe · Healthy = all firm.

Current readings

Retail Sales YoY

—

RSAFS, nominal %

Consumer Sentiment

—

UMCSENT index

CC Delinquency

—

DRCCLACBS, %

Components · inputs

Retail Sales — YoY Growth

Nominal retail & food-service sales, year-on-year. Zero is the contraction line; +2% the soft / healthy boundary.

Consumer Sentiment (UMCSENT)

University of Michigan index. Leading and mood-driven; sharp drops precede spending pullbacks.

Synthesis · household stress

Credit-Card Delinquency Rate

Share of card balances 30+ days past due. A sustained rise is the clearest sign household balance sheets are cracking.

The interest-rate-sensitive leading sector — permits, starts and mortgage rates. The pills read building-permits growth, the earliest cycle turn.

ContractingYoY < −10%

Softening−10–0%

Expanding> 0%

▸ Regime definitions & method

Contracting permits YoY < −10% — a sharp pull-back; housing is leading the cycle down.

Softening −10–0% — permits easing; rate-sensitivity biting.

Expanding > 0% — permits growing; housing supportive.

Building permits lead starts, which lead construction activity. The 30-year mortgage rate is the transmission channel; the NAHB builder index currently reads —.

Current readings

Building Permits

—

PERMIT, thousands SAAR

Housing Starts

—

HOUST, thousands SAAR

30Y Mortgage Rate

—

MORTGAGE30US, %

Components · inputs

Building Permits — Level

New private housing units authorized. The leading housing series.

30-Year Mortgage Rate

The transmission channel — when rates jump, permits roll over with a lag.

Synthesis · the housing pulse

Permits & Starts — Year-over-Year Growth

The leading housing pulse. Permits (solid) lead starts (dashed); zero is the contraction line, −10% the soft / contracting boundary.