Central bankers are raising interest rates on the assumption that wage-push inflation may lead to stagflation. This is … not the case. Although unemployment is low, the labor market is not 'tight'. On the contrary, we show that what matters …, just as in the Great Recession we anticipate deflation in the near future, coupled with rising joblessness and recession. …

' PC (relating the level of the inflation rate, not the change in this rate, to the rate of unemployment); and the …

account deficit, exchange rate, unemployment, inflation, and mortgage rates. Second, we employ probit and logit regression …