Moody's Chief Economist Warns U.S. Recession Is Inevitable If the Strait of Hormuz Closure Continues

KuCoinFlash

Release Time: 03/17/2026 09:06:52

Summary

The market outlook darkens as Moody’s chief economist Mark Zandi warns that a U.S. recession is likely if the Strait of Hormuz remains closed. On March 17, Zandi stated that the economic outlook will continue to deteriorate as long as oil tanker traffic is blocked. Moody’s leading indicators already show a 49% chance of a recession in the next 12 months, and Zandi expects the next update to push that probability above 50%. Other banks still estimate the odds between 30% and 40%, though Yadny Research recently increased the probability of a market crash to 35%. Traders are advised to monitor altcoins closely amid rising uncertainty.

BlockBeats news, on March 17, Moody's chief economist Mark Zandi stated that the U.S. economic outlook will continue to deteriorate as long as the Strait of Hormuz remains effectively closed to oil tankers, despite the United States currently producing roughly the same amount of oil and natural gas as it consumes.

Zandi believes that if the situation remains unchanged over the coming weeks, a U.S. recession will become unavoidable. Even before the Iran conflict erupted, Moody’s machine learning-based leading indicators showed a 49% probability of the U.S. entering a recession within the next 12 months. Zandi expects the next release of this model’s data to show a recession probability of 50% or higher.

Several investment banks still maintain the probability of a recession in the 30% to 40% range, while Adeni Research recently raised the probability of a market crash from 20% to 35%. The S&P 500 rose 1% on Monday, closing at 6,699.38, and Wall Street has not yet priced in a recession.

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