Apollo’s top economist slashes 2025 recession odds from 90% to 30% after US-China tariff respite

Torsten Slok, chief economist at private equity giant Apollo Global Management, warned on April 19 of a 90% chance of the US falling into a “Voluntary Trade Reset Recession” this year. Now, with the US and China dialing down tariffs levied on one another, the risk of a downturn has dropped precipitously in his eyes.

“After the China trade deal, the probability of a US recession in 2025 is now at 30%, and the tail risk coming from a complete collapse in trade between China and the US has been removed,” he wrote in a note this morning.

Slok, who’s typically had more of a glass-half-full view of the US economic outlook, was meaningfully more bearish than “the market” at large on recession risk, at least judging by Polymarket, where recession odds peaked at the start of May at about 66%. Now, betting markets have the odds at about 43%, returning Slok to a position where he’s more optimistic than the crowd.

“The bottom line is that markets may recover quickly from this episode,” he added. “But it will likely take some time before confidence is restored among consumers, corporates, and foreigners.”