US voters in a sour economic mood heading into midterm elections
SPY•Voters are focused on high prices as they head into midterm elections, while the economy shows mixed signals: unemployment was 4.2% in September and GDP grew at a 3.4% annualized pace last quarter.
1. Mixed economic signals
Voters are focused on the cost of living as they head into elections that will decide whether President Donald Trump's Republican Party keeps control of Congress. Unemployment was 4.2% in September, and the rate has been at or below 4.5% for five straight years, the longest stretch on record.
2. Growth and investment
The US economy grew at a 3.4% annualized pace last quarter, its strongest performance this year, while business investment rose at a 12.7% annualized pace. The article says AI-related demand is fueling gains in the stock market and the real economy.
3. Inflation weighs on households
Inflation remains above the Federal Reserve's 2% target, and wages have recently lost ground to rising prices. Consumer prices and average hourly earnings have both risen about 5.5% since January 2025, leaving workers with roughly unchanged purchasing power over that period. Mortgage rates topping 7% and high home prices have added to affordability concerns.
