deflation; monetary tightening
Meanings
2 senses · 5 examplesnoun
deflation; economic contraction caused by currency shortage
Often abbreviated as 通缩 (tōng suō). This phenomenon typically leads to reduced consumer spending, business contraction, and rising unemployment. Distinguished from disinflation (通胀减缓).
Japan experienced prolonged deflation during the 1990s.
Deflation leads to declining corporate profits and reduced investment.
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Unlike inflation, deflation is characterized by continuously falling prices.
noun
contractionary monetary policy; deliberate reduction of money supply
formalRefers to the active policy measure of tightening monetary supply to combat inflation. This is a deliberate action by central banks or governments, distinct from the economic phenomenon described in sense 1.
The central bank implemented contractionary monetary policy by raising interest rates.
To curb excessively rapid price increases, the government decided to adopt monetary tightening measures.