Wall Street betting markets are on fire just hours before the first-quarter GDP release, with odds of a negative U.S. growth print soaring after months of trade war escalation and a record-breaking goods deficit.
According to Kalshi, a CFTC-regulated prediction market, the probability of a contraction in U.S. GDP for the first quarter surged to 65% on Tuesday, just one day before the data drop. The implied reading now point to negative 0.4%, the lowest since late February 2025.
Odds for a positive GDP reading tumbled by 30 percentage points to 39%, implying a $100 bet would return $245 if U.S. economy averts a quarterly contraction.
The economist consensus, as tracked by Trading Economics, still projects a 0.4% annualized expansion, down sharply from the 2.8% pace recorded in the fourth quarter of 2024.
The U.S. economy has not recorded a negative quarterly growth since the first quarter of 2022.