The stable Phillips Curve from the 1960s was challenged by the Friedman-Phelps natural rate model, which suggested that inflation and unemployment were not always negatively correlated. The researchers criticized this model, proposing a Keynesian approach that explains inflation and unemployment fluctuations through inertia in price and wage setting. They found that changes in inflation and unemployment can be influenced by demand and supply shocks, leading to different correlations between the two variables over time. Recently, the relationship between inflation and unemployment has shifted, with inflation showing a muted response to changes in unemployment. It remains uncertain whether low unemployment will lead to a modest increase in inflation, as predicted by Friedman and Phelps, or if inflation will continue to accelerate.