NBER: Recession ended in June 2009

08:46, September 21, 2010      

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The National Bureau of Economic Research (NBER) announced in a statement on Monday that the recession started in December 2007 officially ended in June 2009.

The Business Cycle Dating Committee of the National Bureau of Economic Research made the conclusion on Sunday by conference call.

At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion.

In a statement, NBER said it chose that month based on examination of data including gross domestic product, employment and personal income.

The committee concluded that the choice of June 2009 as the trough month for economic activity was consistent with the later trough months in the labor-market indicators--aggregate hours and employment--for two reasons.

First, the strong growth of quarterly real GDP in the fourth quarter was inconsistent with designating any month in the fourth quarter as the trough month. The committee believes that these quarterly measures of the real volume of output across the entire economy are the most reliable measures of economic activity.

Second, in previous business cycles, aggregate hours and employment have frequently reached their troughs later than the NBER's trough date.

In particular, in 2001-03, the trough in payroll employment occurred 21 months after the NBER trough date.

In 2009, the NBER trough date is 6 months before the trough in payroll employment. In both the 2001-03 and 2009 cycles, household employment also reached its trough later than the NBER trough date.

The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months.

The decision by the NBER also means that any future downturn in the economy would be considered a new recession and not a continuation of the recession that began in 2007.

The NBER, founded in 1920, is a private, nonprofit, nonpartisan research organization dedicated to promoting a greater understanding of how the economy works. It is considered as the arbiter of U.S. recessions.

Source: Xinhua

(Editor:张茜)

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