A zero-inflation policy would correspond to matching the money supply growth to productivity growth. This would, ideally, result in approximately stable prices.

A zero-inflation policy would correspond to matching the money supply growth to productivity growth. This would, ideally, result in approximately stable prices. Relative prices would still vary. A more efficient candy-bar machine would lower prices of candy-bars, whereas hourly wages would be unchanged. Defacto, there is a policy to aim for consumer price inflation of around 2%. Many justifications can be thought of, but one is the tendency that prices and wages rarely adjust downwards. So instead of expecting the economy to lower prices due to productivity increases, the central banks depreciate the currency. This means flat wages in stagnating industries, instead of falling wages. One could argue there is some psychological benefit to this. Another justification is because cash savings depreciate, there is need to invest them. In a textbook world, savings become investments, which creates growth.