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Definition of 'Recession'

A recession is technically defined by economists as a decline in GDP for two or more consecutive quarters. Recessions are almost always accompanied by:
  • A drop in stock market prices
  • An increase in unemployment
  • A decline in the housing market
Many investors and economists consider recessions an inevitable part of the economic cycle and for them to be unavoidable.

If a recession continues for long enough and is severe enough it will be referred to as a depression.

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