Higher inflation could lead the Federal Reserve to keep interest rates — and mortgage rates — elevated until late in the year, eluding political gain for Biden.
The booming economy is exacerbating a key vulnerability for President Biden heading into the height of campaign season, as inflation and interest rates could remain higher until deep into the final weeks of the presidential election.
Fears of rising prices could already be weighing on Americans anew, as consumer sentiment fell unexpectedly in April, according to a University of Michigan For much of his presidency, Biden has struggled with his message on the economy. When inflation first started to beset the country in the months after the pandemic, the president and his team settled on describing it as “transitory,” trying to signal to voters that the spike was temporary and would subside. When Russia invaded Ukraine, the White House started using the phrase “Putin’s price hike,” blaming the war for rising gas prices.
In a twist, the election itself could delay the Fed’s plans. Investors generally expect the central bank to steer clear of policy changes in the lead-up to the presidential race, out of concern that it could be seen favoring one candidate over another. women’s coats, pork chops and visits to the vet — were about 3 percent more expensive than they were in February.
In his rematch against former president Donald Trump, Biden has increasingly tried to contrast his economic record with Trump’s.
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