Reflation


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Related to Reflation: recession, stagflation

Reflation

Government monetary action that causes a reversal of deflation.

Reflation

The act of a government printing money or taking similar actions to combat deflation. Deflation occurs when a recession is so severe that prices are reduced to inspire demand. This often leads to further economic decline. Reflation marks an attempt to increase money supply to increase spending in an attempt to spur growth. See also: Inflation.

reflation

an increase in the level of NATIONAL INCOME and output. A reflation is often deliberately brought about by the authorities in order to secure FULL EMPLOYMENT and to increase the rate of ECONOMIC GROWTH. Instruments of reflationary policy include fiscal measures (for example, tax cuts) and monetary measures (for example, lower interest rates). See also FISCAL POLICY, MONETARY POLICY, DEFLATIONARY GAP, DEMAND MANAGEMENT.
References in periodicals archive ?
He is forecasting reflation will win the day for gold.
And of course, if the reflation does continue, a weakening of the nominal exchange rate need not translate into a depreciation of the real exchange rate.
We are resisting the urge to shift towards the reflation camp and move our global portfolio to a more aggressive cyclical, at least for now.
There were two proposals: Warren and Pearson's raising the price of gold scheme and Fisher's campaign for reflation to combat the debt disease from overindebtedness.
The recovery was consumption-led, [TABULAR DATA OMITTED] fiscal reflation being accompanied by a confidence-induced increase in households' spending propensity, but was further boosted in 1994 by increasing fixed investment.
Indeed, recall that policymakers historically have erred on the reflation side far more often than the opposite.
But at a time when the former Soviet Union and Eastern Europe are collapsing; Europe is battered by recession; Japan is struggling with its own deflation; the Third World is growing more hopelessly mired in poverty, there is remarkably little attention paid to the necessity for global reflation, for new worldwide institutions and initiatives that might create a global Keynesian underpinning for growth.
Because a growing debt ratio cannot be sustained forever, the two countries now face the choice between more fiscal restraint or reflation.
President Roosevelt suspended the gold standard in April 1933 because it encumbered advancement toward the major domestic monetary objective: reflation.
But the belief that reflation was just around the corner caused creditors and debtors to dig themselves in deeper, thus delaying for some years the recovery of the Third World from the Volcker recession of 1981-82.