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A period of slow economic growth, or, in securities trading, a period of inactive trading.


A period where an economy grows at an extremely low rate without actually entering a recession. During stagnation, it is unlikely that jobs will be created, wages will increase, or that the stock market will boom. While there is no exact definition of economic stagnation, most analysts agree that positive growth under 2%-3% qualifies. It may occur because a business cycle is winding down, because a catastrophic event has caused economic uncertainty, or for any number of other reasons. Classical Keynesian economics states that stagnation will result in a period of low inflation because there is no growth in demand for money, but American stagnation in the 1970s also saw a period of high inflation. See also: Brezhnev Stagnation, Stagflation.


Stagnation is a period during which the economy grows slowly, doesn't grow at all, or actually contracts after adjusting for inflation. Typically, there is a corresponding contraction in the stock market.

As a result of a slowing economy, unemployment increases and consumer spending slows. Policymakers may fear a recession, and, in response, the central bank may try to stimulate growth by increasing liquidity and lowering interest rates.

While stagnation is hard on the economy, it's more common and potentially less disruptive than stagflation, which combines slowing growth with rising inflation.


References in periodicals archive ?
Mr Gill said: "The summit is an emergency meeting to be held in response to the dramatic economic changes taking place, including the credit crunch, falling house prices, stagnating house sales and the property crash.
The two primary motives for selling a covered call are: to protect against a potential pullback in the near term, and to earn extra income on a stagnating stock.
The economy has been stagnating since then, and the rise of the yen means that television rights - sold in dollars - will bring in fewer yen than organizers had thought.
In 2005, grocery retailing was stagnating, with current value sales growing by less than half a percentage point.
Until now, with mortgage payments adjusting upward, housing inventories climbing, and prices stagnating, these homeowners have had few options but to lose their house to foreclosure, or capture some of their equity and a fresh start with a quick, honest investor purchase.
He was a leader in helping lead Coffee-mate's change from powder (a stagnating performer) to liquid (a market dominator), making Nestle Hot Chocolate the category leader and bringing his experience to Oregon Chai -- one of the hottest new beverages in the past decade -- where he served as the marketing chief.
With mobile penetration levels in Western home-markets stagnating at near 100%, emerging markets represent the single most important investment opportunity for players in the Telecoms market.
With the CRM market stagnating, there is not much growth opportunity left for the high-end applications providers forcing them to look for new markets or consider mergers and acquisitions in order to grow.
Demand for new equipment in developing regions allows manufacturers of process analytical instruments to sustain revenues despite stagnating need from North America, Europe, and Japan.
However, growth in some mature regional markets is slowing or stagnating, the high-tech research firm says.
The portable and home MP3 CD/MiniDisc player categories will grow only modestly during the forecast due to stagnating portable and home CD player markets, growing consumer awareness of and falling price points on portable flash and jukebox devices, and cannibalization by DVD players and DVRs of standalone home compressed audio players.