Deflation is taking hold in the Eurozone

Deflation is taking hold in the eurozone: Major central banks around the globe might be engaged in a manic policy of monetary and public debt inflation, but deflation is growing. Last month, banks reported that corporate loan demand and personal credit card use are declining, and savings rates remain high. A declining social mood appears to be fueling private debt deflation. But it’s price deflation that is grabbing attention. Falling prices can be found across the continent as economic restrictions and job insecurity deter spending. But in some quarters it’s the fear of steep and entrenched declines — a deflationary trap that
drags wages down and ultimately brings the whole economy down.
Weaker economies, and those more reliant on services such as tourism, are at the greatest risk, putting much of southern Europe once again in danger. Of the seven euro area nations on the Mediterranean and Adriatic seas, only France and Malta have positive rates of inflation. Spain’s is -0.9%, Greece’s is -2%.