Definition
Slow growth and rising unemployment combined with high inflation.
The story
Normally the Fed's job is a trade-off: fight inflation or support jobs. Stagflation means both are going wrong at once. Raise rates and you hurt jobs further; cut them and inflation gets worse. It's the scenario central banks fear most.
Why markets watch it
It's hard on stocks and bonds at the same time.
Connects to
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms