Source: Emily Raimes, Timothy Blake, Daniel Ortega, Nicholas Samuels, Moody’s, Sector In-Depth, State government – US, May 20, 2019
Economic conditions in the US are strong, and the probability of a recession beginning within the next year appears to be low. States are aware that a downturn will come eventually, however, and are building reserves to prepare. According to our scenario analysis, most states will be able to weather a moderate recession without significant adverse credit impact, in large part because of healthy reserves and inherently strong fiscal flexibility. Recession preparedness is stronger for 22 states, moderate for 26 and weaker for two…..