Olivier Coibion, Yuriy Gorodnichenko, and Mauricio Ulate: Is Inflation Just Around the Corner? The Phillips Curve and Global Inflationary Pressures: "An expectations-augmented Phillips curve can account for inflation not just in the U.S. but across a range of countries, once household or firm-level inflation expectations are used.... We find that the implied slack was pushing inflation below expectations in the years after the Great Recession but the global and U.S. inflation gaps have shrunk in recent years thus suggesting tighter economic conditions. While we find no evidence that inflation is on the brink of rising, the sustained deflationary pressures following the Great Recession have abated...
#noted
