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A sustained decrease in the general price level of goods and services, resulting in an increase in the real value of money.
While lower prices might sound appealing, deflation is generally harmful to an economy. It encourages consumers to delay purchases (why buy today if things will be cheaper tomorrow), reduces business revenues and profits, increases the real burden of debt, and can lead to a deflationary spiral of declining demand and layoffs. Japan experienced prolonged deflation from the 1990s through the 2010s, leading to decades of economic stagnation. Central banks fight deflation aggressively through rate cuts and quantitative easing.