Identifying Recession Indicators

As a senior macroeconomic analyst for a wealth management firm, you assess various indicators to forecast economic growth. Recently, you noted a significant rise in commodity prices, especially oil, alongside increasing unemployment claims and a report of contracting GDP in the previous quarter. You are preparing a presentation for the investment team and must determine which of these indicators typically leads to a recessionary environment.

Your analysis indicates that while rising commodity prices often reflect inflationary pressures, they can also impact consumer spending negatively when coupled with rising unemployment. Conversely, contracting GDP is a clear signal of economic slowdown.

Based on this situation, which indicator would you argue is the most relevant in predicting an upcoming recession?