7 Romer and Romer (2004) and Gertler and Karadi (2015) find that it takes about 9 and 12 months, respectively, for monetary policy actions to begin to affect inflation and additional time for that effect to 5  -3monetary policy, the lagged effects of earlier accommodation likely offset some of the initial effects of tightening over the course of 2022, and it is likely that the full effect on demand, employment, and inflation of the cumulative tightening that is in the pipeline still lies ahead.
That said, there is uncertainty about the timing and magnitude. With that in mind, let’s turn to the implications for the employment leg of our dual mandate. In contrast to the slowing of output growth, labor markets remained tight throughout 2022, with layoffs remaining below pre-pandemic levels and the unemployment rate ending the year at 3.5 percent, its historical low.