the non accelerating rate of inflation
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The non-accelerating rate of inflation (NAIRU) refers to the lowest level of unemployment that is consistent with stable and low inflation in a given economy. NAIRU is the rate of unemployment at which there is little pressure on wages to rise and, consequently, prices to increase. When unemployment is below the NAIRU, demand for labor is higher, leading to wage increases, which in turn leads to higher prices and inflation. When unemployment is above the NAIRU, there is less pressure on wages and prices to increase. Therefore, maintaining the unemployment rate at or near the NAIRU is a key objective of monetary policy.