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Deflation's Impact on Inflation
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Deflation in the prices of durable goods in the US signals a potential return of inflation towards the Federal Reserve's 2% target. Economists predict this easing of inflation to occur in the second half of the following year, attributed to supply chain improvements and weaker demand.
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How might the return of deflation impact consumer spending and business investment?
What are the potential long-term implications of supply chain improvements and weaker demand on inflation and the broader economy?
What measures can the Federal Reserve take to effectively manage inflation in the face of deflation in durable goods prices?
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