Is the US heading for stagflation?
US academics weigh up the risks – and whether the Fed can avoid the worst outcomes
Academics from some of the top institutions in the US warn the economy could be heading for stagflation on the current path of monetary policy.
Stagflation – a combination of stagnant or contracting economic activity and rising inflation – is already threatening. Headline inflation was 6.8% in June, and GDP growth was negative in both the first quarters of 2022.
The labour market remains one bright spot, as unemployment was steady at 3.6% in June, with 372,000 more jobs added. A key question
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