Has the economy changed dating

A: It's more accurate to say that a recession–the way we use the word–is a period of diminishing activity rather than diminished activity.We identify a month when the economy reached a peak of activity and a later month when the economy reached a trough.In that cycle, as well, the dating of the trough relied primarily on output measures.Q: Isn't a recession a period of diminished economic activity?The differences between these two sets of estimates were particularly evident in the recessions of 20-2009.Q: How does the committee weight employment in determining the dates of peaks and troughs? In the 2007-2009 recession, the central indicators–real GDP and real GDI–gave mixed signals about the peak date and a clear signal about the trough date.Thus, the unemployment rate is often a leading indicator of the business-cycle peak.For example, the unemployment rate reached its lowest level prior to the December 2007 peak of activity in May 2007 at 4.4 percent and climbed to 5.0 percent by December 2007.

In this respect, the unemployment rate is a lagging indicator.The NBER business-cycle chronology considers economic activity, which grows along an upward trend.As a result, the unemployment rate often rises before the peak of economic activity, when activity is still rising but below its normal trend rate of increase.A: Most of the recessions identified by our procedures do consist of two or more quarters of declining real GDP, but not all of them.In 2001, for example, the recession did not include two consecutive quarters of decline in real GDP.

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