Definitions 
Deflation is an on-going decrease in prices. It is the opposite of inflation. If a banana cost $2, one year and $1 the next. The rate of deflation (for bananas) is 100%.
The effects of deflation are the opposite of inflation. Whereas inflation is negative for holders of cash and positive for borrowers, deflation is positive for holders of cash and negative for borrowers.
Deflation: A Negative for the Economy
It is worth noting that deflation is generally considered a negative situation for an economy to be in. One reason for this is it encourages people to postpone purchases until (if deflation continues) they have fallen further.
