Akademik

deflation

Decline in the prices of goods and services. Antithesis of inflation. Bloomberg Financial Dictionary

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The rate at which the general level of prices for goods and services is decreasing - the opposite of inflation.

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deflation de‧fla‧tion [ˌdiːˈfleɪʆən, dɪ-] noun [uncountable]

ECONOMICS when a government reduces demand for goods and services by raising interest rates and taxes, limiting wage increases, or reducing government spending, or a combination of these:

• Governments responded to the loss of competitiveness by deflation and incomes policies.

— deflationary adjective :

• The government was unwilling to introduce adequate deflationary policies.

ˈasset deˌflation ECONOMICS FINANCE

when the value of assets such as property is falling:

• All around the world you have asset deflation going on. The whole world is slowing into a recession.

ˈcurrency deˌflation also ˈmonetary deˌflation ECONOMICS

a situation in which prices are falling:

• Governments can't employ monetary deflation because it destroys private debtors.
— compare disinflation, inflation

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A fall in prices. Not to be confused with depreciation, which is a fall in value of a currency.

► See also Depreciation, Disinflation, Inflation.

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deflation UK US /dɪˈfleɪʃ^ən/ noun [U]

► ECONOMICS an economic situation in which prices fall and there is a reduction in wages and government spending, and low levels of growth: »Global deflation is squeezing profits and extinguishing jobs.
»He warned that Euroland could sink into deflation unless the central bankers tailored their policies to promote economic growth.
»In monetary deflation, a contracting money supply causes prices and demand to decline.

► a situation in which the value or price of something is reduced: »The current deflation of home prices is having a profound effect on American society.
»The price of cars, computers, and dishwashers have all been falling as global deflation in traded goods gathers pace.
»asset deflation.

→ Compare DISINFLATION(Cf. ↑disinflation), INFLATION(Cf. ↑inflation), REFLATION(Cf. ↑reflation)

Financial and business terms. 2012.