Reflation

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Reflation

Government monetary action that causes a reversal of deflation.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005