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The Inflation Project

Longer-term deflation probabilities decline

Prices of Treasury Inflation-Protected Securities (TIPS) with similar maturity dates can be used to measure probabilities of a net decline in the consumer price index over the five-year period starting in early 2011. One measure of this deflation probability declined from 13 percent on November 30 to 12 percent on December 7, the lowest reading since mid-August. An alternative lower bound on the probability of deflation has remained at 0 percent since November 15.

categories: deflation