Goldman Declares the Death of Global Phillips Curve Exaggerated

  • Unemployment-inflation link `alive and well,' Goldman says
  • Fed Governor Brainard questioned relationship this week

Fed Chair Janet Yellen said in September that “a labor market moving toward full employment is one that historically has generated upward pressure on inflation. So that bolsters my confidence in inflation.”

Photographer: Andrew Harrer/Bloomberg

The traditional relationship between falling unemployment and faster inflation was supposed to be a victim of the financial crisis. A debate has erupted whether that is still the case.

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