Hurricanes End 83-Month Employment Expansion

The bond market agrees with the macro data. The yield curve has 'inverted' (10 year yields less than 2-year yields) ahead of every recession in the past 40 years (arrows). The lag between inversion and the start of the next recession has been long: at least a year and in several instances as long as 2-3 years. On this basis, the current expansion will last well into 2018 at a minimum. Enlarge any image by clicking on it.

Unemployment claims are also in a declining trend; historically, claims have started to rise at least 6 months ahead of the next recession.

Note that recent hurricanes are likely to have a short-term negative impact to upcoming economic data. In the past, growth has quickly resumed. Thus, jobless claims recently spiked higher after Harvey, as it also did after Katrina and Sandy (chart above). GDP forecasts have also fallen in the wake of Harvey (from the Atlanta Fed).