A sustained fall in the general price level — the opposite of inflation.
Counterintuitively damaging — consumers delay purchases expecting lower prices, debts become harder to repay (real value rises), and economic activity contracts. Japan struggled with deflation for decades. Central banks fear deflation more than moderate inflation.
A sustained fall in the general price level — the opposite of inflation. Counterintuitively damaging — consumers delay purchases expecting lower prices, debts become harder to repay (real value rises), and economic activity contracts. Japan struggled with deflation for decades. Central banks fear deflation more than moderate inflation.
In economics, Deflation is one of the building blocks investors use to compare opportunities and assess risk. Understanding it helps you read research notes, earnings reports, and market commentary without getting lost in jargon.
Counterintuitively damaging — consumers delay purchases expecting lower prices, debts become harder to repay (real value rises), and economic activity contracts. Japan struggled with deflation for decades.
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