Price Deflation Trend

A Price Deflation Trend is an downward temporal trend to a price index that is below zero.

• Context:
  • It can be caused by a Price Deflation Cause, such as tight monetary supply or a Pandemic.
  • It can be measured with an Inflation Rate/Price Index Change Rate.
  • It can range from being a Hyperdeflation Trend to being an Tolerable Deflation Trend.
  • …
• Example(s):
  • Japanese Yen Deflation During the 1990s.
  • …
• Counter-Example(s):
  • Price Inflation.
  • Price Disinflation (downward trend but still positive).
  • Price Stability.
• See: Deflation Rate, Money Supply, Nominal Value, Deflationary Spiral.

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References

2020

• (Wikipedia, 2020) ⇒ https://en.wikipedia.org/wiki/deflation Retrieved:2020-4-6.
  • In economics, deflation is a decrease in the general price level of goods and services. Deflation occurs when the inflation rate falls below 0% (a negative inflation rate). Inflation reduces the value of currency over time, but sudden deflation increases it. This allows more goods and services to be bought than before with the same amount of currency. Deflation is distinct from disinflation, a slow-down in the inflation rate, i.e. when inflation declines to a lower rate but is still positive. Economists generally believe that a sudden deflationary shock is a problem in a modern economy because it increases the real value of debt, especially if the deflation is unexpected. Deflation may also aggravate recessions and lead to a deflationary spiral. Deflation usually happens when supply is high (when excess production occurs), when demand is low (when consumption decreases), or when the money supply decreases (sometimes in response to a contraction created from careless investment or a credit crunch) or because of a net capital outflow from the economy. It can also occur due to too much competition and too little market concentration.

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