Deflation in economics is a persistent decrease in the general price level of goods and services - a negative inflation rate. When the inflation rate slows down (decreases, but remains positive), this is known as disinflation.
Inflation destroys real value in money. Deflation creates real value in money. Deflation is considered a problem in a modern economy because of the potential of a deflationary spiral and its association with the Great Depression, although not all episodes of deflation correspond to periods of poor economic growth historically.
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