Wait, so are we really headed for a recession?

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President Donald Trump says his administration is making “very big” moves and has acknowledged there’s likely a “period of transition” or “disturbance” that could result.

When asked during an interview that aired this weekend on Fox News about the likelihood of a recession being one of those outcomes, Trump told Maria Bartiromo: “I hate to predict things like that.”

Fears of a severe economic downturn have escalated in recent weeks, and stocks plunged Monday on Trump’s comments, continuing a steep selloff driven by concerns about the impact of tariffs on US economic growth.

But are recession fears justified? Here’s what history and the current economic picture can tell us about the potential for a recession:

What is a recession?

The traditional (and official) definition of a US recession is “a significant decline in economic activity that is spread across the economy and that lasts more than a few months.”

That’s according to the National Bureau of Economic Research, a private nonprofit organization has a very important role, when it comes to these downturns: Its Business Cycle Dating Committee is the official designator of peaks, troughs, expansions, contractions — and yes, recessions — in the business cycle.

The committee, in making its recession determination, uses three criteria: depth, diffusion and duration.

This is where it gets a little squishy.

While each of those need to be met individually to some degree, extreme conditions in one of those areas can offset weaker conditions in the others.

Also, it’s often the case that the US already is in a recession by the time the Business Cycle Dating Committee officially deems it so.

Prognosticators have turned to other gauges as potential recessionary indicators; however, they don’t always prove true.

The biggest rule of thumb or nonofficial recession indicator is the technical notion of back-to-back quarterly contractions in real gross domestic product — the broadest measure of economic activity.

“We have to be careful with that definition,” Gregory Daco, chief economist at EY Parthenon, told CNN Monday. “A contraction in GDP can come from multiple sources, including, as may be the case in the first quarter (of this year), from an environment where you have a surge in imports.”

The running forecast of GDP from the Federal Reserve Bank of Atlanta estimates that first-quarter GDP may decline by an annualized adjusted rate of 2.4%, the first quarterly contraction in the US since 2022.

Import activity has accelerated and the trade deficit has grown in recent months as businesses and consumers ramped up purchases in advance of potential tariffs levied by the Trump administration.

Plus, the back-to-back GDP indicator isn’t always accurate: The US experienced this in the first half of 2022, although the second quarter was eventually revised into a slight expansion. While those declines set off alarm bells, 2022 was a year of transition as the economy sought to recover from the sharp and sudden downturn caused by the global pandemic.

Imbalances in trade and inventories had an outsized effect on the GDP data in the earlier part of that year.

If the rule of thumb can’t always be trusted, and the official ruling comes late to the party, what are recession events?

The NBER committee has its 3 Ds and Daco has his “Triple P” rule: “a profound, pervasive and persistent contraction.”

“It can’t just be a blip in economic activity,” he said. “It has to be pervasive in that it can’t just be one sector or one weak region of the economy. It has to be across sectors and across regions of the country, and it has to last.”

He added: “There has to be some persistence. So, it can’t just be a one-month mishap with consumer spending or employment, or whatever economic data we get — it has to last some time.”

The exception to the rule was the recession triggered during the Covid-19 pandemic in that it was extremely profound, extremely pervasive, but very short-lived, he said.

What about now? Is a recession imminent?

Economic warning signals have increasingly been tripped in recent weeks as the Trump administration’s sweeping policy changes across major areas of the economy have heightened uncertainty.

Layoffs are ticking higher and inflation reaccelerated last month, with consumer prices rising at their fastest pace since August 2023. Data also showed consumer confidence took a significant hit in February.

“We’re not seeing any indication that there is an imminent recession, but we are seeing signs that private sector activity is cooling,” Daco said. “We’re seeing slower labor market momentum. We’re seeing consumers spending with more caution. We’re seeing businesses adopting a bit of a wait-and-see approach, and we have a lot of uncertainty and a lot of downside risks from the policies — in particular, the trade policies that are being implemented.”

To that end, there are plenty of reasons to be cautious right now, Daco said.

“There isn’t necessarily a reason to be extremely concerned about an imminent recession, because we’re coming out of two very strong years of growth,” he said, “an environment where income growth was strong, where productivity growth was strong, where consumer spending growth is strong and, really, where the economy overall was quite strong.”

However, as 2025 rolls on, and if the headwinds from restrictive trade and immigration policy as well as overall uncertainty, continue to persist, that could lead to a more pronounced slowdown in economic activity that could trigger stress in financial markets.

One of the biggest areas to watch in the coming months will be the financial health of Americans.

“Consumer spending is the main pillar of the US economy; so, if it were to start cracking, then that would remove one of the main foundations of the US economy, and could precipitate a recession,” Daco said. “The trajectory right now of consumer spending is not in and of itself concerning — on average, we’re still seeing strong consumer spending momentum — but higher income individuals are doing more than their fair share of spending”

And if that group pares back or has its confidence shaken, that would be a concern, he said.

For now, Trump’s tariff policies seem to be sowing confusion for businesses, consumers and investors. Over the past few weeks, the Trump administration has imposed steep tariffs on America’s three largest trading partners, Canada, China, and Mexico, stoking fears of increased prices. Trump has said the tariffs on Canada and Mexico are a result of the countries’ policies around undocumented immigration and drug trafficking. Last last week he said he was delaying the bulk of his most severe tariff threats. They are now set to go into effect on April 2.

Daco said uncertainty and confusion around such policies does not help the overall economic picture.

“What you have right now is a lack of clarity of policy, a lack of clarity of policy intention and a lack of clarity as to the objectives of policy,” Daco said. “All of those combine for a certain sense of unease from the business community, because there’s no clear destination in terms of where policy will settle.”

CNN’s Samantha Delouya contributed to this report.