The goal of macroeconomic policy should be to avoid this type of situation. It is precisely for this reason that Canada's inflation-targeting framework operates symmetrically. But weak demand isn't the only thing that may pull down prices.
A drop in prices that is triggered by increased productivity would not harm an economy, because the higher productivity would boost profits, stimulate business spending, and improve real incomes. With that in mind, let's look at what has been happening to prices around the world. In many of the world's biggest economies—Japan being the exception—inflation has been averaging around 2 per cent.