Inflation hits 3-year high, pressuring Fed to raise rates as election nears

President Donald Trump is on a mission to lower borrowing costs as quickly as possible. Wall Street now expects them to go higher.

The Commerce Department on Thursday reported that the Federal Reserve's preferred inflation gauge rose at an annual rate of 4.1 percent last month — more than double the central bank's target. Even excluding volatile food and energy prices, the so-called core measure of the personal consumption expenditures index climbed at its fastest pace in almost three years.

The recent surge in prices has weakened the spending power of American consumers, who were already furious about the rising cost of living. And now, markets are pricing in a 64 percent likelihood that Trump's new Federal Reserve chair, Kevin Warsh, will raise rates as early as September, which would tighten financial conditions for households and businesses in the weeks leading up to the midterm elections.

If the Fed raises rates in the coming months, that would be a blow to Trump and the GOP's economic sales pitch at the height of a campaign that will be defined by affordability.

https://finance.yahoo.com/economy/policy/articles/trump-wants-lower-interest-rates-142906229.html

So much winning.