As Americans head to the polls on November 3, 2026, for the midterm elections, economic concerns are top of mind. High inflation and rising prices have left voters in a sour mood, with many blaming President Donald Trump’s policies, particularly tariffs and the ongoing Iran war, for their financial struggles.
Despite the gloomy sentiment, economic indicators paint a mixed picture. Unemployment remains historically low at 4.2%, and overall economic growth is solid, with the third quarter showing a 3.4% annualized pace. The artificial intelligence (AI) investment boom has also driven stock market gains, benefiting retirement accounts and higher-income households.
However, inflation persists, though it has eased from its 2022 peak. Consumer surveys reflect this tension, with the University of Michigan’s sentiment index hitting a near-record low, while the Conference Board’s confidence index improved in October. Brian Jacobsen, chief economic strategist at Annex Wealth Management, noted that sentiment drives election outcomes, while confidence influences markets.
Some economists warn of potential fragility in the economy. A sharp reset in AI expectations could undermine corporate confidence and slow GDP growth, especially as higher oil prices, tariffs, and tighter immigration policies push inflation higher. The Federal Reserve raised its policy rate in September and is expected to do so again in December to combat inflation without causing job losses.