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Analysis-Job-inflation tradeoff, exiled from Fed policy, could mean a hot summer

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Reuters

By Howard Schneider WASHINGTON (Reuters) – Tension between sticky job markets and rising prices could pose a growing problem for U.S. Federal Reserve officials who have staked an aggressive monetary policy on the belief they can avoid a conflict between returning U.S. employment to pre-pandemic levels and keeping inflation under control. Traditionally, some trade-off between the two is regarded as unavoidable, with the cost of controlling inflation paid in slowed growth and fewer jobs as the Fed raises interest rates to cool things off. But weak inflation over the last 30 years has convinced F…

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