Summers: Inflation Is a Worry as Long as There’s an ‘Unprecedented’ Ratio of Openings to Unemployment

During an interview aired on Friday’s edition of Bloomberg’s “Wall Street Week,” Harvard Professor, economist, Director of the National Economic Council under President Barack Obama, and Treasury Secretary under President Bill Clinton Larry Summers reacted to the June jobs report by stating that as long as we’re in “unprecedented territory in terms of the ratio of job openings to unemployed people, I don’t think we can stop being concerned about inflation.”

Summers stated that there isn’t anything in the jobs report “that should change somebody’s mind in a major way about what monetary policy is going to need to do at the next meeting or at, probably, the meeting after the next meeting. I think what would start to change things would be very strong evidence that the economy was slowing substantially in an across-the-board way with respect to consumption and investment demand. I think if you saw a precipitous decline in the level of vacancies and level of labor turnover, that would be an indicator that I would be watching. But as long as we’re in almost — actually unprecedented territory in terms of the ratio of job openings to unemployed people, I don’t think we can stop being concerned about inflation.”

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