From Longman Business Dictionarydisinflationdis‧in‧fla‧tion /ˌdɪsɪnˈfleɪʃən/ noun [uncountable] ECONOMICS when a government reduces the rate of inflation without also reducing the general level of economic activity or increasing unemployment. This may be done by raising interest rates, controlling the amount of credit available to people, and limiting the availability of goods which are in short supply. Disinflation is a gentle form of DEFLATIONIf the downward pressure on prices is too strong, an economy can easily tip from disinflation into deflation. —disinflationary adjectiveSome argue that disinflationary forces are so strong that movements in the exchange rate pose no threat.
