While the economy is still in a “strong position,” the risks that unemployment and inflation will rise have gone up, the Federal Reserve said last week.
by Lorie Konish
CNBC.com
The U.S. economy is still in a “strong position” despite “heightened uncertainty,” according to the Federal Reserve’s latest assessment.
Yet there’s a looming economic risk the U.S. hasn’t meaningfully faced for decades — stagflation.
“The risks of higher unemployment and higher inflation appear to have risen,” Federal Reserve Chairman Jerome Powell said on May 7.
Those two factors — along with slower economic growth — are the definition of stagflation.