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A marked contraction in economic activity. There is little agreement on a definition, but a recession is often associated with at least two consecutive quarters of declining GDP or the verification that one exists by an august body such as the National Bureau of Economic Research in the US. A global recession is often thought to be a situation when global GDP growth falls below 2 per cent.
The fallout from the global financial crisis of 2008/2009 plunged much of the developed world into a deep recession. Demand for goods and services declined, which had a knock-on effect on companies. Unemployment grew and investment stalled. With tax revenues declining, government borrowing also grew and attempts to rectify weak public finances exacerbated the crisis particularly in the so-called peripheral eurozone countries of Greece, Portugal, Spain, Italy and Ireland. Austerity measures were adopted across Europe and the US and were made a condition of further lending to many of the worst affected countries such as Greece. Monetary policy across advanced economies in recession was loosened aggressively with sharp cuts in interest rates to historic lows and unorthodox policies such as quantitative easing in the US and UK and long-term cheap lending to banks in the eurozone. All such monetary policy measures were aimed at stimulating economic activity in their countries and lifting them out of recession. At the beginning of January 2013 there were fears that many advanced economies would be disappointed by the growth rate.
FT articles and indepth pages that cover recession