Aufschwung

Aufschwung is a German term for the phase of rising economic activity in a business cycle, typically following a trough and preceding a peak. The word combines auf- (up) and Schwung (momentum or swing). In macroeconomic analysis, an Aufschwung is marked by accelerating GDP growth, expanding production, rising employment, and improving consumer and business confidence.

Durations and intensities vary. Economists distinguish a broad expansion or upturn as the period when macroeconomic indicators trend upward for multiple quarters. Key indicators include positive GDP growth, increased industrial output, higher capacity utilization, falling unemployment, and rising retail sales and investment. Inflation can be stable or begin to rise if demand strengthens, but a late-phase Aufschwung risks overheating.

Causes of an Aufschwung may include recovering domestic demand, favorable financial conditions, monetary and fiscal stimulus, improving external demand, or technological progress. Policy responses during an upturn typically aim to sustain growth while containing inflation and financial risk, for example by gradually tightening monetary conditions if inflation accelerates or asset prices become unsustainable.

Historically, the term is used in German-speaking economies to describe recoveries after recessions and downturns. It is part of the generic business cycle framework, with the opposite phase labeled Abschwung or Rezession.