It wasn’t long ago that the Federal Reserve looked on track to cut interest rates this spring. But those optimistic days sure feel like they’ve slipped away.
Since the start of the year, central bankers’ hopes to take pressure off the economy with lower borrowing costs have gotten dimmer and dimmer. Inflation is heating back up, and economists fear the stickiest drivers of rising prices are getting harder to scrub away. The unwelcome surprises now have forecasters eyeing fewer cuts, closer to the end of the year — which would put the Fed squarely in the middle of a heated election season, and possibly inflame a kind of political firestorm central bankers try to avoid.