A term developed in the mid 1990s to describe the positive performance of the economy as "not too hot, not too cold; just right."
Economic growth that is neither too hot (inflation) nor too cold (recession). Indicators would be GDP growth of around 3%, inflation around 2% and unemployment of around 4%.
A term referring to the U.S. economy of the mid- to late-1990s. It was "not too hot, not too cold, but just right."
The "Goldilocks economy" is not too hot or cold economy sustaining moderate economic growth and a low inflation allowing for a market friendly monetary policy.