Disinflation

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Disinflation

A decrease in the rate of inflation.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Disinflation

A situation in which the inflation rate decreases, but does not reverse. For example, disinflation occurs when the inflation rate goes from 5% to 2%. Importantly, it is not deflation when the inflation rate becomes negative. Disinflation is considered a normal and healthy part of a business cycle.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

disinflation

A slowdown in the rate of inflation. A drop in the inflation rate from 3% in one year to 2% in the next year is an example of disinflation. On an overall basis, disinflation is good for security prices, but it can be painful for individual companies that have made investment and borrowing decisions based upon a belief that a high rate of inflation would continue. See also inflation.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Disinflation.

Disinflation is a slowdown in the rate of price increases that historically occurs during a recession, when the supply of goods is greater than the demand for them.

Unlike deflation, however, when prices for goods actually drop, disinflation prices do not usually fall, but the rate of inflation becomes negligible.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

disinflation

a fall in the general price level, frequently accompanied by a reduction in the level of national income (DEFLATION). A disinflation is often deliberately brought about by the authorities in order to combat INFLATION and to eliminate a BALANCE OF PAYMENTS deficit. Instruments of disinflationary policy include fiscal measures (e.g. tax increases), monetary measures (e.g. higher interest rates), and prices and income controls. See FISCAL POLICY, MONETARY POLICY, PRICES AND INCOME POLICY, INFLATIONARY GAP, INTERNAL-EXTERNAL BALANCE MODEL.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
This drift has amplified the goods disinflation and explains why PCE measures of inflation are running below CPI measures.
This paper's empirical method allows us to measure the sacrifice ratio as the costs of a deliberate disinflation policy in contrast to, for example, the output costs of a series of negative cost push shocks.
"Disinflations in Latin America and the Caribbean: A Free Lunch?" Journal of Macroeconomics, 2007, doi: 10.1016/j.jmacro.2006.
Models of parameter uncertainty and learning have also addressed questions about gradual versus rapid disinflation. With results similar to ours, Balvers and Cosimano (1994) find that rapid disinflation is preferred when inflation is high, although in their framework rapid reduction in money growth is warranted to facilitate learning.
286) writes, "The result that disinflation causes a boom may appear counterintuitive, given the usual view that disinflations cause recessions.
The fluctuations in these markets, however, occurred in an era of aggregate price inflation followed by a sharp disinflation, which, according to Schwartz, increased the severity of the resulting financial distress.
Disinflation appears to be consistently more costly and no more rapid in countries with independent central banks, even holding wage indexation constant.
The flat portion of the Phillips curve also has implications for the timing of deliberate disinflations. The linear Phillips curve indicates that once output is below trend, inflation pressures fall.
In addition, even when the Fed pays the price of disinflation, the gains may not be permanent.
stabilization, that is, the branch dealing with disinflations from high