(Bloomberg) -- White House Press Secretary Karine Jean-Pierre expressed confidence that the Federal Reserve’s fourth straight super-sized rate increase will help curb price increases that have been a drag on Democrats’ prospects heading into next week’s midterm elections.
“The Fed actions help bring inflation down,” Jean-Pierre told reporters Wednesday, adding, “This is part of our transition to stable and steady growth.”
The central bank raised rates by 75 basis points Wednesday to a range of 3.75% to 4%, the highest level since 2008, as the central bank extends its most aggressive tightening campaign since the 1980s.
“As mortgage rates increase, demand in the housing market should continue to cool and inventory should increase, which should have the effect of lowering housing inflation,” Jean-Pierre said.
Read more: Fed Hikes Again by 75 Basis Points, Hints at Entering End Phase
Red-hot inflation has imperiled Democrats’ chances of retaining their House and Senate majorities in the Nov. 8 midterms and has hampered President Joe Biden’s approval ratings. Some 46% of Americans surveyed by Monmouth University last month said inflation was an extremely important issue to them -- up from 37% in September and far outpacing any other issue. In the same poll, 63% of Americans said they wished Biden would give more attention to the issues important to their family.
Fed Chairman Jerome Powell is trying to curb the hottest inflation in 40 years amid criticism he was slow to respond to rising prices last year. The hikes have roiled financial markets as investors worry the Fed could trigger a recession.
The president last month said a recession in the US was possible but that any downturn would be “very slight” and that the US economy is resilient enough to ride out the turbulence.
Read more: Biden’s ‘Slight’ Recession Would Mean Economic Pain for Millions
Despite Biden’s efforts to downplay the threat of a recession, median estimate of economists surveyed by Bloomberg forecast a 60% chance of a downturn within the next year.