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The Economy in Perspective

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Laboring under a false impression … If inflation is, as Milton Friedman once said, always and everywhere a monetary phenomenon, why do so many Fed-watchers scan the labor market for clues to future inflation? Why do they think that the unemployment rate, the employment growth rate, or wage changes foreshadow inflation movements?

Suggested citation: “The Economy in Perspective,” Federal Reserve Bank of Cleveland, Economic Trends, no. 97-03, pp. 01, 03.01.1997.

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