Deflation is the decline in prices for goods and services that happens when the inflation rate dips below 0%.
 | | Deflation | | Deflation is the general decline in prices for goods and services occurring when the inflation rate falls below 0%. Deflation happens naturally when the money supply of an economy is fixed. In times of deflation, the purchasing power of currency and wages are higher than they otherwise would have been. This is distinct from but similar to price deflation, which is a general decrease in the price level...Read More » | | Can Deflation Be Good? | | General economic theory consensus rules that deflation is bad for the economy. But the Swiss economy is growing despite a drop in prices. | | Read More » | | | Inflation | | Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. | | Read More » | | | Monetary Policy | | Monetary policy: Actions of a central bank or other committees that determine the size and rate of growth of the money supply, which will affect interest rates. | | Read More » | | | Fiscal Policy | | The use of government spending and tax policies to influence macroeconomic conditions, including aggregate demand, employment, inflation and economic growth. | | Read More » | | | Monetary Theory | | Monetary theory is a set of ideas about how changes in the money supply impact levels of economic activity. | | Read More » | | | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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