Something is happening in the U.S. economy. The question is what.
As the rate of U.S. price inflation finally breaks through 2 percent and unemployment has fallen to 3.9 percent and wage growth picks up, the Fed talks of ongoing rate hikes. Will a tighter monetary policy choke off a labor market recovery? Probably not. It turns out economists, forecasters and pundits don’t actually have a firm handle on the relationship between these variables.