If financial conditions tighten sharply, this suggests a coming slowdown or recession.

Currently, the St. Louis Financial Stress Index and the Chicago Fed National Financial Conditions Index are at lowest and below zero.

The average value of the St. Louis Financial Stress Index is designed to be zero since 1993. Thus, zero representing normal financial market conditions, a value below zero suggests below-average financial market stress, and a value above zero suggests above-average financial market stress.