Recession

A recession is a significant, widespread, and prolonged decline in economic activity — conventionally defined as two consecutive quarters of negative real GDP growth — characterised by falling output, rising unemployment, reduced consumer spending, declining business investment, and contraction in trade and industrial production. Recessions are a natural phase of the business cycle, typically following periods of economic overheating, and are often triggered by external shocks (such as oil price spikes, financial crises, or pandemics), excessive monetary tightening, or the unwinding of asset bubbles. The severity and duration of recessions vary widely — from mild slowdowns (technical recessions) to deep contractions (depressions). For investors and traders on Ventura Securities, recession risks profoundly influence equity market direction, sector rotation strategies, credit quality in bond portfolios, and central bank policy trajectories — defensive sectors (healthcare, FMCG, utilities) and gold typically outperform during recessions, while cyclicals (banking, metals, real estate, auto) tend to underperform, making recession risk monitoring a critical component of dynamic asset allocation.