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KBRA Releases Research - Inflation: Watch the Headlights or the Rearview Mirror?Kroll Bond Rating Agency (KBRA) releases research which discusses current inflation dynamics in the U.S. The report examines how the COVID-19 shock could be upsetting a pre-pandemic trend in place, namely, the breakdown of the Phillips Curve and the traditional tradeoff between inflation and unemployment. Several trends underlying the low inflation environment before COVID-19 still exist today. However, others could imply diverging trends for inflation and unemployment. On balance, fundamentals point to inflation temporarily accelerating to well above target levels before pulling back. Medium- to longer-term performance is expected to depend on supply-side factors, once pent-up demand and consumer behavior reset to more normal, post-pandemic levels. Key Takeaways
Related Publications Access for free at www.kbra.com
About KBRA KBRA is a full-service credit rating agency registered in the U.S., the EU and the UK, and is designated to provide structured finance ratings in Canada. KBRA's ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.
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