The Fed’s long-awaited rate cut is colliding with presidential politics

The Federal Reserve is preparing to cut interest rates for the first time in the Biden era after the White House spent the last three years grappling with Americans’ dissatisfaction with the cost of living, raising new questions about the health of the economy and the impact on voters at the ballot box.

The Federal Reserve is preparing to cut interest rates for the first time in the Biden era after the White House spent the last three years grappling with Americans’ dissatisfaction with the cost of living, raising new questions about the health of the economy and the impact on voters at the ballot box. The move is fresh vindication for President Joe Biden, whose pandemic-era agenda ushered in trillions of dollars in government spending — which, when coupled with strong demand for goods, supply chain snarls and Russia’s war with Ukraine — drove inflation to a four-decade high. The cut, which will probably be a quarter-point or a half-point of a percent, could indicate the elusive “soft landing” — experts’ favored term for raising borrowing costs to slow the economic activity while avoiding severe joblessness — has been reached. Biden, who has publicly touted the Fed’s policy independence, will speak at the Economic Club of Washington, DC, on Thursday and likely tout an economy that’s come full circle in four years. But it could also suggest the economy, which is showing signs of stress, is in need of a jolt. Although most mainstream economists agree a recession is not around the corner, they also suggest the economy is not out of the woods yet. With less than 50 days until Election Day, another question has emerged: Will it matter to voters? Nevada real estate agent Zoila Sanchez told CNN’s John King that lower interest rates would bring welcome relief to residents looking to buy a house or refinance.