From the Fed’s Minutes Members expected real GDP growth to be moderate over coming quarters and then to pick up very gradually, with the unemployment rate declining only slowly. With longer-term inflation expectations stable, members anticipated that inflation over the medium run would be at or below 2 percent a year.

Source: FOMC Minutes, June 2012 Are FOMC members predicting that the U.S.

economy will move along a short-run Phillips curve or that the short-run Phillips curve will shift through 2012 and 2013? Explain.