During this week's monetary policy meeting, Federal Reserve Chair Jerome Powell and other Fed officials are likely considering the potential impact of President-elect Donald Trump's return to the White House on the economy's soft landing. A soft landing is a scenario where inflation decreases without a significant rise in the unemployment rate, a situation that has been successfully maintained so far.
The Fed's preferred inflation gauge is currently just slightly above its 2% target, a significant improvement from June 2022 when it reached a 40-year high of 7.2%. Despite the Fed's efforts to combat inflation by raising interest rates starting in March 2022, the unemployment rate has only seen a modest increase from 3.6% in June 2022 to 4.1% in October of this year.
