18 For example, Federal Reserve Chairman Arthur Burns once noted (Burns, 1977, p. 717): “Federal Reserve officials are extremely careful to avoid any public comment that might suggest or imply some particular outlook for interest rates.” In the United Kingdom, in 1981 Chancellor of the Exchequer  -7 clarity on the reaction function and of having long-term interest rates incorporate accurate expectations of future policy.
In purely technical terms, deflation may be defined as a fall in prices, but it conjures up much more than that, viz. the depression of the 1930s. A slight decrease of the general price level need not of course be attended by an overall collapse of demand.