Inflation Hasn’t Been This High Going Into Election Day Since 2008

Key Takeaways

• Although inflation has been cooling, voters may remember the 2022 price spike when they go to the polls this year.
• Inflation hasn’t been this high during election season since 2008 during the financial crisis.
• Although inflation has typically been below 4% during presidential elections over the past two decades, voters in 1980 faced the highest inflation recorded during a presidential campaign. 

After months of campaigning, the 2024 presidential election is right around the corner, and many voters are looking at the economy before casting their vote.

Perhaps no economic issue has attracted more attention than inflation, as voters have experienced some of the highest price levels in the last 30 years. 

In a Gallup survey on election issues, 14% of Americans said inflation was the biggest issue facing the country, and another 21% said the economy in general presented the biggest challenge for the nation.

Learn More Ahead of the Election

This is one of a series of articles Investopedia is doing around important economic indicators heading into the 2024 election. You can read more here:

• Most Americans Feel They’re Worse Off Now Than In 2020—Here’s What The Data Says
• How Has The Economy Grown Before Previous Elections?

According to the September measurement of the Personal Consumption Expenditures (PCE) price index, inflation has cooled to 2.1% over the year. However, prices haven’t come down, and many voters still remember the recent spike in inflation, which hit 7.2% in June 2022.

Voters have faced varying degrees of price pressures as they have gone to the polls in recent years. Here are some of the inflation rates that voters experienced in recent elections.

Biden Won During Pandemic-Era Low Inflation

For voters, the September print of the PCE is usually the last inflation reading they get before heading to the ballot box. When voters went to the polls in 2020, the inflation rate was 1.3%, up a tick from the prior month.

While inflation was low during the period, it also occurred during the backdrop of the global COVID-19 pandemic, which created several economic issues for voters that ultimately helped Joe Biden defeat incumbent Donald Trump in that election. 

Trump Won During Period of Steady Inflation

In 2016, Trump was able to win during a period of similarly low inflation, with the September inflation rate at 1.2%. The favorable inflation rate came during President Barack Obama’s administration, but voters didn’t reward his party, as Trump defeated Democratic candidate Hillary Clinton. 

Obama Won Re-Election on Low Inflation Following 2008 Spike

In the 2012 presidential election, President Barack Obama won reelection against the backdrop of a September inflation rate of 1.7%, up slightly from the prior month. Obama won the 2008 election against the backdrop of that year’s financial crisis when inflation was at 3.7% after hitting 4% the month earlier. 

Bush Faced Similar Inflation Pattern in Election Victories

Inflation was near the current level when former President George W. Bush won his first presidential election. Voters faced an inflation rate of 2.5% in September 2000. Four years later, inflation was slightly better at 2.3% in September 2004. While these readings were higher than the Federal Reserve’s target of 2%, that goal wasn’t formally established until 2012.

Reagan Won As Inflation Topped 10%, Reelected as Price Pressures Cooled

While inflation hasn’t been much of an issue for voters over the past 40 years, the 1980 presidential election happened during a much different economic environment.

During that election, the annual inflation rate was 10.7% going into voting day, the highest during any presidential campaign in the PCE’s 64-year history. Former President Ronald Reagan defeated incumbent President Jimmy Carter in that election. Four years later, Reagan won reelection behind an inflation rate that had dropped to 3.3%.