New York Federal Reserve Recession Model: Only 1-in-32 Chance of Double-Dip Recession in 2012

The New York Federal Reserve updated its "Probability of U.S. Recession Predicted by Treasury Spread" last week with treasury yield data through November 2011, and the Fed's recession probability forecast through November 2012 (see chart above). The NY Fed's Treasury model uses the spread between the yields on 10-year Treasury notes (2.01% in November) and 3-month Treasury bills (0.01%) to calculate the probability of a U.S. recession up to twelve months ahead (see details here) using the spread between those two yields (1.42% in November).

According to the NY Fed's Treasury Spread model (data here) the chances of a double-dip recession through November of next year are 3.6%, or only a one-in-28 chance.