(Bloomberg) — President Joe Biden is trying to capitalize on a sudden spate of positive economic news to turn Democrats’ biggest political liability into an unlikely election-year selling point.
Falling gas prices, two major legislative victories and early signals that red-hot inflation may be easing have boosted Democrats’ once improbable bid to retain their House and Senate majorities in the November midterms.
Biden plans to argue Tuesday that he and his fellow Democrats have helped steer the economy back to firmer footing during a White House ceremony touting a sweeping new climate, energy and health care law dubbed the “Inflation Reduction Act.” The saliency of that message could be helped — or undercut — by the latest government inflation data, due for release just ahead of the event.
US equities climbed Monday on expectations that the Labor Department report will show consumer prices slowing in August, though the optimism could prove short-lived if the data doesn’t meet forecasts. Economists surveyed by Bloomberg project the Consumer Price Index reading will drop 0.1% from July but remain historically high, rising 8% from a year ago.
Also threatening to upend Biden’s strategy is the possibility of a rail strike that could snarl supply chains, disrupt agricultural deliveries and cost the US economy more than $2 billion a day. The Biden administration is pressuring labor unions and freight-rail operators to agree on a new contract before a Friday deadline.
Democrats have made some headway in eroding the advantage that inflation has afforded Republicans in the midterms, said Brian Stryker, a partner at Democratic polling firm Impact Research, which aided Biden’s 2020 presidential campaign and consults with gubernatorial and congressional candidates.
Biden on Monday issued an executive order laying out priorities for the law’s execution, including reducing greenhouse gas emissions, building US clean energy capacity and creating jobs. The order also establishes a White House office on clean energy innovation and implementation.
The White House’s effort to shift the narrative included Biden’s visit Friday to a construction site in Ohio, where Intel Corp. is building a new plant to make computer chips. The trip gave the president an opportunity to highlight legislation signed into law last month aimed at boosting domestic semiconductor manufacturing.
“Since I took office, our economy has created nearly 10 million new jobs, more than 668,000 manufacturing jobs — proof of point that ‘Made in Ohio’ and ‘Made in America’ is no longer just a slogan,” Biden said at the event. “It’s a reality today. And it’s just beginning.”
The president also has pivoted away somewhat from the economy in recent weeks to highlight the threat he contends Republicans pose to democracy, most notably during a Sept. 1 prime-time speech in which he said his predecessor, Donald Trump, and Republicans who back him “represent an extremism that threatens the very foundation of our republic.”
Read more: Biden Demonizes GOP in Midterm Pivot From Uncertain Economy
Republicans, for their part, plan to keep the focus on the still-high cost of groceries, housing and other day-to-day items, even as Democrats try to use their recent accomplishments to transform the state of the economy into less of a political liability.
Democrats should aim for a repeat of 2012, when President Barack Obama was able to persuade enough voters to overlook an economic drawback — then, high unemployment — and grant him a second term, Stryker said.
“Voters thought Obama was trying and that some of those efforts would bear fruit,” he said. “That is where Democrats need to get voters.”
Biden’s overall approval rating increased six percentage points to 44% in late August, according to Gallup — his highest level in a year. The president still earns especially low marks for his handling of the economy, but the proportion of Americans who cited inflation as their top concern headed into the midterms dropped from 37% to 30% in a Sept. 8 NPR/PBS NewsHour/Marist poll.
Biden’s recent legislative victories “are meaningful both substantively and politically and have marginally improved his approval ratings and attitudes about the direction of the country,” Doug Sosnik, former White House political director under President Bill Clinton, wrote in a recent memo.
“Historical political gravity is on the Republicans’ side, but the Democrats head into the fall election with a stronger counter-narrative than they had in the spring,” Sosnik wrote.
(Updates with Biden signing an executive order, in seventh paragraph.)
VANCOUVER – Canada’s labour minister says striking grain terminal workers in Metro Vancouver and their employers have reached a tentative labour deal.
Steven MacKinnon announced the agreement between Grain Workers Union Local 333 and the Vancouver Terminal Elevators’ Association in a post on social media platform X, but provided no other details.
The union confirmed the tentative deal in a statement on Facebook, saying its members will conduct the ratification vote by Oct. 4.
The notification from the union also says picket lines were to be removed Saturday and members will return to work pending ratification, ending the strike that had paralyzed grain shipments from Metro Vancouver’s port.
The dispute had previously led to picket lines going up at six Metro Vancouver grain terminals on Tuesday as about 600 workers went on strike.
Canadian grain producers had urged a resolution in the dispute, noting about 52 per cent of the country’s grains moved through Metro Vancouver terminals last year en route to being exported.
Farmers say the strike, happening during crop harvesting, would result in as much as $35 million per day in lost exports.
The Western Grain Elevator Association said on Friday that talks had stalled after two days of negotiations this week, with the employer saying it had increased its offers to settle “outstanding issues.”
The employers group had said they’ve reached the end of their “financial ability to conclude an agreement that industry can absorb” with the last offer, and it was up to the federally appointed mediator to report the results to MacKinnon for the next steps.
MacKinnon says in his tweet that both parties put in “the work necessary to get a deal done.”
This report by The Canadian Press was first published Sept. 28, 2024.
TORONTO – Canada’s main stock index dipped lower Friday despite strength in energy stocks, while U.S. markets were mixed as the Dow eked out another record but tech stocks dragged.
The mood Friday was mixed after a strong week for equities in both Canada and the U.S., said Andrew Buntain, vice-president and portfolio manager at Fiduciary Trust Canada.
The S&P/TSX composite index closed down 77.01 points at 23,956.82, one day after it . It closed over 24,000 for the first time on Thursday.
The strength this past week wasn’t just in North American markets, noted Buntain, as Chinese stocks enjoyed a rally after the country’s central banks announced a suite of measures intended to boost the economy.
Meanwhile, an undercurrent of broadening strength continued this week as investors spread out their interest beyond a narrow set of tech giants, said Buntain.
“Some of the sectors that have been ignored for several years have been some of the better performers this year,” he said.
“We’re very encouraged by that.”
In New York on Friday, the Dow Jones industrial average was up 137.89 points at 42,313. The S&P 500 index was down 7.20 points at 5,738.17 after setting an all-time high on Thursday, while the Nasdaq composite was down 70.70 points at 18,119.59.
A report Friday on one of the U.S. central bank’s preferred measures of inflation — the personal consumption expenditures price index — showed continued cooling.
The Federal Reserve started lowering its key interest rate last week, and is expected to keep going this fall and into 2025.
However, the Fed’s next interest rate decision isn’t until November, noted Buntain, so there’s plenty of data for the central bank to take in yet — including next week’s labour report.
The job market has been an increasingly key focus for the central bank after recent reports showed cooling in that area of the economy. Friday’s report also showed consumer spending in August didn’t meet economists’ expectations.
In Canada, where the Bank of Canada is set for its next rate decision later in October, Friday brought a GDP report that was a little stronger than expected, said Buntain.
“The Bank of Canada has already delivered three cuts and signalled maybe some further reductions,” he said.
If inflation continues to move lower, Buntain added, the Bank of Canada could even announce an outsized half-percentage-point cut, echoing the Fed’s move last week.
The Canadian dollar traded for 74.08 cents US compared with 74.22 cents US on Thursday.
The November crude oil contract was up 51 cents at US$68.18 per barrel and the November natural gas contract was up 15 cents at US$2.90 per mmBTU.
The December gold contract was down US$26.80 at US$2,668.10 an ounce and the December copper contract was down four cents at US$4.60 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published Sept. 27, 2024.
OTTAWA – Statistics Canada says real gross domestic product grew 0.2 per cent in July, following essentially no change in June, helped by strength in the retail trade sector.
The agency says the growth came as services-producing industries grew 0.2 per cent for the month.
The retail trade sector was the largest contributor to overall growth in July as it gained one per cent, helped by the motor vehicles and parts dealers subsector which gained 2.8 per cent.
The public sector aggregate, which includes the educational services, health care and social assistance, and public administration sectors, gained 0.3 per cent, while the finance and insurance sector rose 0.5 per cent.
Meanwhile, goods-producing industries gained 0.1 per cent in July as the utilities sector rose 1.3 per cent and the manufacturing sector grew 0.3 per cent.
Statistics Canada’s early estimate for August suggests real GDP for the month was essentially unchanged, as increases in oil and gas extraction and the public sector were offset by decreases in manufacturing and transportation and warehousing.
This report by The Canadian Press was first published Sept. 27, 2024.
