Trough
Plain definition
A trough is the lowest point of the business cycle — the moment when declining economic activity stops falling and begins to turn upward. It marks the end of a contraction and the start of an expansion.
In economics
Troughs are identified by the NBER's dating committee only after the fact, since in real time it is hard to tell whether a downturn has bottomed. Economists watch leading indicators — new orders, building permits, stock prices — to judge when a trough is near. The depth of the trough largely determines how long the following recovery must run to restore prior output levels.
Example
The NBER dated the trough of the Great Recession to June 2009, when U.S. real GDP stopped falling and began to grow again. Unemployment, a lagging indicator, kept rising until October 2009 — proof that the trough in output does not mean the trough in jobs.
Trough is confused with 'the bottom of a recession' in a loose sense — but technically the trough is the single turning point, the moment of minimum activity, not the whole downturn. It is also distinct from a market bottom: stock prices often trough months before the economy does, because markets are forward-looking.