Daily Point 2278 - Contraction (Trade Cycles)

 

The Banking Tutor 

Daily Point 2278 

Contraction (Trade Cycles) 

A business cycle contraction is a period of decline in economic activity, characterized by a decrease in real Gross Domestic Product (GDP). It follows the peak of an expansion and precedes the trough, leading to lower employment, reduced consumer and business spending, and falling profits. This phase can lead to a recession if the decline is significant or prolonged, with two consecutive quarters of negative GDP growth being a common indicator. 

Sekhar Pariti

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