The Phillips curve suggests rising wages from low unemployment may increase inflation temporarily. High inflation may prompt Fed rate hikes, raising borrowing costs and wage demands. Despite ...

The well-known Phillips curve suggests that future inflation depends on current and past inflation and a measure of economic slack or resource utilization. Using the unemployment gap to measure slack, ...

Price rigidity is a key mechanism through which monetary policy is thought to affect the economy. When some prices are hard to change, firms may respond to a monetary impetus by changing instead their ...

The surprise for 2018 will be how little inflation will rise. Markets are building a house of cards on plans for inflation to return as they bet on a return of the Phillips curve. The anticipated ...