A financial recession is a significant decline in economic activity that lasts for an extended period, typically visible in various indicators such as GDP, employment, and consumer spending. During a recession, businesses may experience lower sales, leading to layoffs and reduced investment, which further exacerbates the economic downturn. Recessions can be triggered by various factors, including high inflation, rising interest rates, or external shocks like a global pandemic. Governments and central banks often respond with measures such as lowering interest rates or implementing stimulus packages to encourage spending and investment, aiming to revive the economy.