Deflation

Deflation is the decrease in the general price level of goods and services in an economy over time. It means that consumers can buy more with the same amount of money, which might sound good initially. However, deflation can lead to reduced consumer spending, as people may delay purchases, expecting prices to fall further. This can cause businesses to lower production, leading to layoffs and economic slowdown. Deflation is often linked to economic recessions and can create a cycle that's hard to escape, as lower spending leads to lower prices, further worsening the economy.