Once again. Bitcoin is not deflationary.
Right now it is inflationary, increasing at ~10% yearly.
Once it reaches 21 million units, the amount of units will not change, unless you account for lost/destroyed coins.
So, a bit of extra money coming into the system is good as long as it stays in line with the general economy/population growth. The current system has abused this system, and way more money is coming in than any sort of growth in the economy. That's why fiat is coming crashing down.
Firstly, money has different value to different people. Everybody has a unique demand for money relative to how they value it against what they must trade for the money.
For example, a thirsty man in the desert would likely trade more bitcoins for a sip of water than would a man who has a water well on his property.
A market value for money is only established after individual value assessment of buyers and sellers are considered.
Secondly, now that we understand that money cannot keep its value static over time, because we know that this value is not actually measurable, and that demand/supply schedules will change as exchanges are made, we must consider the idea that a perfect money does change its market "value."
The changing market valuation of money plays an important role in the economy.
Lower interest rates signal to entrepreneurs that there are savers in the economy, with a time preference to spend later, not now. These entrepreneurs may decide to embark on grander endeavors because they know that there will be sufficient demand in the future.
On the other hand, when consumption increases, the interest rates will rise, as lenders compete to attract borrowers. There is a time preference to spend money now, and less of a savings pool will be collected for future spending.
Money must be able to change its value in accordance with market forces. Otherwise, the prices of all goods would be badly skewed.
Imagine if a bitcoin was always worth 1 gallon of milk, 1 hamburger, or 1 t-shirt, and that this value did not change.
What do you think would happen to the economy if an epidemic caused a shortage of cow livestock? In this hypothetical there is a shortage of cows, which means a shortage of milk and beef. Milk and burgers should cost more in terms of money units, assuming that demand has not changed. But with some external force pegging bitcoin to 1 gallon of milk, the milkmen and burger flippers would be getting a bad deal.