Disinflation

Disinflation is a decrease in the rate of inflation – a slowdown in the rate of increase of the general price level of goods and services in a nation's gross domestic product over time. It is the opposite of reflation. Disinflation occurs when the increase in the “consumer price level” slows down from the previous period when the prices were rising.

If the inflation rate is not very high to start with, disinflation can lead to deflation – decreases in the general price level of goods and services. For example, if the annual inflation rate for the month of January is 5% and it is 4% in the month of February, the prices disinflated by 1% but are still increasing at a 4% annual rate. Again if the current rate is 1% and it is –2% for the following month, prices disinflated by 3% i.e. [1%–(-2)%] and are decreasing at a 2% annual rate.

There is widespread consensus among economists that inflation is caused by increases in the supply of money available for use in a nation's economy. Inflation can also occur when the economy 'overheats' because of excess aggregate demand (this is called demand-pull inflation). The causes of disinflation are the opposite, either a decrease in the growth rate of the money supply, or a business cycle contraction (recession). If the central bank of a country enacts tighter monetary policy, that is to say, the government starts selling its securities, the supply of money in an economy is reduced. This contraction of the money supply is known as quantitative tightening. During a recession, competition among businesses for customers becomes more intense, and so retailers are no longer able to pass on higher prices along to their customers. The main reason is that when the central bank adopts tight monetary policy, it becomes expensive to access money, which reduces demand for goods and services in the economy. Even though demand for commodities falls, supply of commodities remains unaltered. Thus, prices fall over time, which leads to disinflation. In contrast, deflation occurs when prices are actually dropping.

...
Wikipedia