The country is facing a negative inflation or deflation scenario with
inflation touching near-zero level of 0.44% and expected to go down
further in coming weeks. If negative inflation sustains for longer
period of time, it will affect economic activities and in turn
performance of most of the companies.

In the current scenario, prices are falling not because of improved
productivity but because of fall in demand. If deflation sustains for
longer period of time, it will have a more adverse impact on demand.
"Deflation results in less demand, lower production and weak economic
growth,"

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