In early January 2026, Mark Zandi, the chief economist at Moody's Analytics, assessed the U.S. economy using the Vicious Cycle Index (VCI) he co-created. This recession indicator evaluates changes in labor force participation and adjustments to unemployment rates. Zandi noted that the index signaled the potential onset of a recession by showing an increase of over one percentage point in the three-month average unemployment rate. He emphasized that the VCI had remained elevated throughout the preceding three months, suggesting that economic conditions were deteriorating despite some positive job statistics released in March 2026. Zandi cautioned against overinterpreting those results, citing that they did not accurately reflect the broader economic challenges exacerbated by external factors like the conflict in Iran. He also pointed out that many economists, including himself, had elevated the likelihood of recession, with various organizations estimating a significant probability of the U.S. falling into a downturn within the next year. Notably, the March job reports, which documented 178,000 jobs added, provided an overly optimistic impression of employment conditions that did not capture the true economic strain. He discussed the implications of discouraged workers exiting the labor market, which further masked the reality suggested by the VCI readings. Nonetheless, Zandi indicated that while the VCI had flashed a warning, it would take time for official confirmation from the National Bureau of Economic Research before declaring a recession, highlighting the fluidity of economic assessments in the current climate that also included responses from the Federal Reserve regarding interest rates.