Governor of the National Bank of Austria (OeNB), the country's central bank, Ewald Nowotny, on Tuesday warned of the danger of deflation, saying to do nothing against it would be "inhuman."
If it were to happen there would be very few means by which the OeNB could counteract it, and ultimately the large majority of the population would be the worst affected, the Austria Press Agency quoted the governor as saying.
He added that "not even a dictatorship could manage" to convince people to put up with the effects of deflation, such as to be out of work longer-term and lose various health and social-care benefits.
Nowotny said it was important for the Austrian central bank to "not let it get that far," which he added is not as simple as it used to be, in that simply lowering interest rates is not enough, and that the economy ultimately needs investment.
The European Central Bank is due to meet on Thursday, where it is speculated the central bank may introduce a negative interest rate on money that banks have deposited with it, which would mean the banks would have to pay for the service.