As retailers and restaurants experiment with going cash-free, a new paper from the Federal Reserve’s Cash Product Office explores the benefits to businesses while also cautioning that the practice could alienate over a quarter of U.S. consumers.
Unemployment is running low, but inflation has not picked up. This suggests that the unemployment rate consistent with stable inflation has fallen. Combining a conventional Phillips curve tradeoff between unemployment and inflation with a noninflationary unemployment rate that can change over time shows threshold estimates have declined toward 4% in recent years. One possible reason for this decline is job-matching improvements, reflected in favorable job-finding rates for disadvantaged groups.
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