deflationary spiral
/dɪˈfleɪʃənəri ˈspaɪrəl/ · de·flā·tion·a·ry spi·ral
noun
- A self‑reinforcing economic cycle in which falling price levels lead to reduced consumer spending, lower production, wage cuts, and further price declines. During the early 1930s, many economists warned that the United States was sliding into a deflationary spiral as unemployment rose and prices kept dropping.
Synonyms
deflationary cycleprice‑deflation loopdownward price spiraleconomic contraction spiralrecessionary spiralfalling‑price spiralcredit crunchmonetary tightening feedback
Antonyms
Did you know? The term gained prominence in the 1970s when economists debated whether stagflation could trigger a deflationary spiral, a concern that resurfaced during the 2008 financial crisis.