If the inflation rate is not very high to start with, disinflation can lead to deflation – decreases in the overall money supply, as well as decreases in the general price level of goods and services, typically as a resulting effect. 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.