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It’s about that time of the cycle for ‘learned’ academic papers to start popping up claiming the NAIRU, the ‘non accelerating inflation rate of unemployment’ (or something like that) is in actual fact more like 7% rather than the currently believed 5%.

And expect these findings to show that it’s always been closer to 7%, but that a temporary glut in global supply, due to the removal of prior international trade constraints, temporarily permitted lower unemployment rates to not trigger accelerating inflation.

Now, however, this ‘slack’ has been used up.

That will suggest that inflation will continue to accelerate until the unemployment rate is over 7%, much like it is in the eurozone.


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