Major legacy problems in the loan portfolios may lead to banks holding back longer in granting new loans. III. Aspects of the risk situation in the German banking system  Beyond the risks emanating from the global setting, the risk and stability situation in the German financial system looks more positive than it did a year ago.
So while deflation or very low inflation in these countries is probably a sign of temporarily weak demand, which is something that policymakers there presumably wish to address, it still does not seem all that likely that they will find themselves in a deflation trap of the kind sketched out above. What about the US?