A review of the Phillips curve in the United States and the euro zone

We look at how the link between unemployment rate, employment rate and core inflation has evolved in the United States and the euro zone: Either overall; Or by breaking down between labour market mechanisms (link between unemployment, employment and wages) and goods market mechanisms (link between labour costs and prices). We see in both the United States and the euro zone that the disappearance of the link between unemployment and inflation is due to both the weakening of the effect of unemployment on wage growth and the major weakening of the effect of labour costs on prices. A rise in labour costs would therefore squeeze earnings in the United States and the euro zone: pricing power is not higher in the United States. In both regions, a fall in unemployment hardly benefits employees. The situations of the United States and the euro zone are therefore fairly symmetrical.