A weak Philips curve relationship does not reduce the Federal Reserve's ability to determine inflation over time, said Richmond Fed president Jeffrey Lacker on Thursday. The Phillips Curve is the relationship between unemployment and inflation. In the crudest definition, the lower that unemployment goes, the higher inflation goes. Some doves on the Fed have argued that the relationship has broken down and the Fed should not hike rates based on a low unemployment rate alone but wait for higher wages and inflation to emerge. But in a speech to the Cato Institute in Washington, Lacker appeared to be pushing back on this ... (full story)