Brief description of Japanese deflation

A snippet from a MarketWatch article, describing the deflation in Japan.

Rising prices are usually a signal of interest rate rises to come, but have an added significance in Japan.

Japan's economic woes during a decade from the early 1990s on were accompanied by stubborn deflation - prices falling rather than rising.

That encourages consumers to save rather than spend, since goods will be cheaper in the future, and hits businesses wanting to invest.

The zero-rate policy was an attempt to correct this effect.

:) Falkor

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