beyond the tradeoff between the first moments of unemployment and infl ation provided by the short-run Phillips curve. Higher … volatility in ifln ation raises unemployment at low-frequency. Increased volatility in infl ation makes nominal wages more … guarantee the equilibrium in the labor market. The positive long-run co-movement between unemployment and infl ation volatility …

of four explanatory variables: yearly infl ation rate, exchange rate, ECB main refi nancing rate and growth rate of M2 …. The annualized infl ation rate proved to be statistically insignifi cant in the model. We fi nd interesting that the … statistical quality of the estimated model was further increased after a six-month lag of the annual infl ation rate added to the …