JPMorgan Chase & Co. now sees a 35% chance that the U.S. economy tips into a recession by the end of this year, up from 25% as of the start of last month.

U.S. news “hints at a sharper-than-expected weakening in labor demand and early signs of labor shedding,” JPMorgan economists led by Bruce Kasman wrote in a note to clients Wednesday. The team kept the odds of a recession by the second half of 2025 at 45%.

“This modest increase in our assessment of recession risk contrasts with a more substantial reassessment we are making to the interest rate outlook,” Kasman and his colleagues wrote. JPMorgan now sees just a 30% chance of the Federal Reserve and its peers keeping interest rates “high-for-long,” compared with a 50-50 assessment as recently as two months back.

With U.S. inflation pressures coming down, JPMorgan sees the Fed cutting rates by half a percentage point in September and November.

The bank’s new calculation for recession risks follows a similar step by Goldman Sachs Group Inc., which now sees a 25% probability of a recession in the next year.

Realization of a “US/global recession” would “almost certainly produce a sharp and immediate easing” by central banks, the JPMorgan economists also wrote.

Big Lots closing even more stores in California

Discount retailer Big Lots is shuttering 75 stores in California, new regulatory documents show.

The 386-page filing to the Securities and Exchange Commission details new loan terms with its creditors that include even more store closures than previously stated. Two months ago, Big Lots said it would close 150 stores, but that number has since grown to 315.

California is taking the biggest hit. By the time the latest stores close, it will operate just 34 locations in the state.

The Ohio-based discounter cited the U.S. economy and “macroeconomic challenges” such as inflation that are curbing customer spending. First quarter sales were down nearly 10%. The company in its earnings call reported a net loss of $205 million for the period.

Jobless claims fall more than expected

Initial applications for U.S. unemployment benefits fell last week by the most in nearly a year, potentially alleviating some concerns that the labor market is cooling too fast following last week’s disappointing jobs report.

Initial claims decreased by 17,000 to 233,000 in the week ended Aug. 3, according to Labor Department data released Thursday. That was helped by fewer applications in states that had registered large increases in recent weeks, such as Michigan, Missouri and Texas.

The decline in initial applications may help reassure markets that the workforce is simply reverting to its pre-pandemic trend rather than rapidly deteriorating. That was the consensus until last week, when the jobs report showed employers substantially scaled back hiring in July and the unemployment rate rose for a fourth month, triggering a key recession indicator.

That contributed to a global market selloff and prompted calls for the Federal Reserve to start lowering interest rates before its next scheduled policy meeting in September which economists say would be highly unlikely.

Prices going up for Disney streaming services

Disney’s streaming services are about to get more expensive.

The Burbank-based company announced on Tuesday that it would raise prices across the board for Disney+, Hulu, and ESPN+.

Beginning on October 17, U.S. subscribers to Disney+ will have to pay $2 more per month for its plans: Disney+ with ads will cost $9.99, up from $7.99. Its ad-free plan will cost $15.99, up from $13.99.

Hulu’s ad-supported plan will also increase to $9.99 per month, from $7.99, and its ad-free plan will rise by one dollar to $18.99.

In recent months, rival online video services including Netflix Inc., Comcast Corp.’s Peacock and Warner Bros Discovery Inc.’s Max have also announced plans to raise prices. Disney increased its streaming prices by as much as 27% a year ago.

Disney, like other traditional media giants, is transitioning to streaming from broadcast and cable TV, where audiences are shrinking and ad sales are declining.

The company has vowed its streaming business will be profitable by its fourth fiscal quarter.

Compiled from Associated Press, Bloomberg and staff reports.