A new report finds the U.S. economy shrank from July to September (in the third quarter) -- an indication of a recession in the United States.
The U.S. Commerce Department says Thursday the country's Gross Domestic Product (GDP) -- the value of all the goods and services produced in the U.S. -- fell by three-tenths of a percent.
That is a sharp change from the previous three-month period when the GDP grew (by two-point-eight percent). It also comes as consumer spending -- a main driver of the U.S. economy -- fell for the first time in about two decades.
A recession is technically defined as two consecutive three-month periods when the economy shrinks. But a growing number of economists say other statistics, including unemployment figures, show the U.S. is already in a recession.
Also today, a report by the U.S. Labor Department says the number of Americans who lost their jobs and are continuing to apply for government aid rose to more than three-point-seven million, close to a five-year-high.
Before the release of the latest economic data, Asian stock markets soared. Japan's Nikkei index closed up 10 percent, while Hong Kong's Hang Seng index was up almost 13 percent.
The GDP figure comes one day after the U.S. Federal Reserve (the U.S. central bank) cut its key interest rate by one-half of one percent in an effort to encourage lending and boost the economy.
Other countries have also been cutting interest rates and taking other action.
Earlier today, Japan unveiled a nearly 300-billion dollar economic stimulus package. Japanese Prime Minister Taro Aso says it includes tax cuts and loans to help small businesses.
And a leading German politician (Peter Struck of the Social Democratic Party) tells a German newspaper ("Berliner Zeitung") the government is preparing to introduce a range of measures -- worth billions of dollars -- to bolster the economy.