U.S. President Donald Trump and the Republican Party are entering the final months before the November congressional elections in a difficult situation. While the ongoing conflict with Iran is straining Washington's foreign policy and keeping energy prices high, new economic data also shows a weakening U.S. labor market. Polls suggest that Republicans are losing their traditional advantage in terms of public perception of the economy.
According to a Reuters/Ipsos poll released at the beginning of August, 37 percent of Americans trust Democrats on issues related to economic management, compared to 36 percent who trust Republicans. This marks the first time in nearly ten years that Democrats have surpassed Republicans in this area. Only 35 percent of respondents approved of Trump's performance in the same poll. In a hypothetical congressional election, 42 percent of registered voters supported Democratic candidates, while 37 percent supported Republican candidates.
The latest labor market data is also concerning. The U.S. Department of Labor announced that the economy lost 23,000 non-farm jobs in July. The unemployment rate was 4.1 percent. In the previous twelve months, an average of only 34,000 jobs were created per month.
Consumer confidence is also weakening. The Conference Board's Consumer Confidence Index fell to 90.8 in July from 92.2 in June. Assessments of current economic and employment conditions have worsened for the third consecutive month.
Another problem remains the energy prices related to the conflict with Iran and the uncertainty surrounding the Strait of Hormuz. The price of Brent crude oil rose above $87 per barrel on Sunday after hopes for a quick agreement between Washington and Tehran diminished again.
CNN points out that the combination of expensive fuel, a weaker labor market, and the ongoing conflict could harm Republicans before the November elections. At the same time, Trump claims that he now prioritizes economic pressure and limited negotiations over further military escalation in his dealings with Iran.
The election is increasingly looking like a referendum not only on Trump's foreign policy but also on whether Americans will experience an improvement in their own economic situation before they go to the polls.