The word had become an antique from the Great Depression. And gradually deflation is becoming a familiar idea. Deflation is not yet happening in the United States. Prices are not falling across the board. But they are dropping for a growing number of goods.
Cars are one example.
So is some apparel, steel and fuel oil. The Consumer Price Index, covering both goods and services, continues to rise, at a very mild 1.6 percent a year. But the index for goods alone rose by only 0.2 percent in the 12 months ended in August, the smallest gain in nearly 40 years. Zero inflation has a happy side. A small wage increase adjusted for nonexistent inflation represents a real improvement in buying power.