NEW YORK (Reuters) - The risk of the U.S. economy slipping into a recession in the next 12 months increased to its highest level during the current expansion following a drop in auto sales in June, J.P. Morgan economists said on Friday.

The economists' gauge on recession risk rose to 37 percent, compared with 34 percent on June 16, as a result of a 5 percent decline in domestic vehicle sales last month, they said in a research note.

(Reporting by Richard Leong, Editing by Franklin Paul)