Raoul Pal, global macro analyst and publisher of the of "Global Macro Investor," says that figures from the Economic Cycle Research Institute (ECRI) and the Institute for Supply Management (ISM) indicate that growth will be negative next year.

“The probability of us going into a second recession is very high,” Pal told CNBC. “Everything I look at in forward indicators suggest that we’re going to go there by Q1 next year … (these indicators) are not infallible, but they give you a high probability of what’s going to happen.”

“ISM (indicators) generally work 90 percent of the time.”

Nonetheless, Pal thinks the dollar will go up. Given the sovereign debt crisis, “it’s much more risky to hold euros … and something like 50 percent of the world’s debt is denominated in dollars,” Pal says. “As people start to pay off or write off debt, the dollar goes up because you’re taking dollars out of the system.”

And of the Fed’s expected QE II, Pal says “There’s no real evidence that (quantitative easing) has worked in the past, so there’s no evidence it will work now. It’s a high risk thing for them to try and do.”

The Institute for Supply Management’s factory index dropped to 54.4 from 56.3 in August, Bloomberg reports, and manufacturing expanded in September at the slowest pace in 10 months.

Readings greater than 50 signal growth and economists forecast a decline to 54.5, according to the median estimate in a Bloomberg News survey.