Rising Oil Prices Fuel Inflation And Threaten Biden’s Re-Election

The world economy has mostly recovered from the COVID-19 pandemic, but nonetheless, US inflation remains well above the desired 2% threshold at an estimated 3.7% in August. Core inflation for the year 2023 is expected to be 4.3%. It is possible that the Fed would need to apply another rate hike to drive inflation down, causing a rougher landing than the Biden Administration hoped for.

Inflation and gasoline/oil prices will be key issues during the 2024 presidential election and the Republican party may attack President Biden on the shape of the economy, which could deteriorate if prices continue to rise, and the recession ticks unemployment up.

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