WASHINGTON: When the US Federal Reserve issues its next interest rate decision Wednesday, the dawn of a bitterly fought presidential election day will be only 136 hours away.

Trailing in opinion polls, Republican nominee Donald Trump has lambasted the central bank and accused it of artificially suppressing rates to help President Barack Obama — a charge Fed Chair Janet Yellen has emphatically denied.

Most observers expect the Fed’s Federal Open Market Committee, which sets interest rate policy, to stand pat, seeing no pressing need to act, especially right before an election.

While Fed members are divided on the dangers of inflation, the majority are expected to vote to leave rates at their historically low target range of 0.25-0.5 per cent for one more month.

“There would be no reason to potentially create noise around an election,” said David Stockton, a former Fed research director now at the Peterson Institute for International Economics.

By law, the Fed is insulated from political pressures and its budget is not set by Congress. And analysts agree there is no sign electoral politics are directly influencing the Fed’s thinking.

The two-day FOMC meeting more likely will be focused on setting market and investor expectations for the final rate meeting of the year in December, Stockton told AFP.

“The statement following this meeting will probably hint more strongly at a rate raise in December.”

The FOMC divisions — which spilt out into the open over the summer, revealing a minority favouring rate hikes sooner rather than later to head off inflation — showed it has faced tough decisions.

So far in 2016, they have refrained from acting in order to avoid interrupting the mild economic recovery. Job creation has been relatively strong. But wage growth has been sluggish, so the job market has not produced unequivocal signs of inflation.

At the September meeting, policymakers said the decision not to raise rates was a “close call.” Three of the 10 voting members dissented and called for a rate hike.

Since that meeting, US economic data has remained spotty. The economy grew a robust 2.9 per cent in the third quarter, according to the initial report Friday, subject to revision. A respectable 156,000 jobs were added in September, and the unemployment rate has remained steady at around 5 per cent.

But inflation, as measured by the Fed’s preferred personal consumption expenditures index, slowed in the July-September period to 1.4 per cent from 2.0 per cent in the prior quarter, which was the first time it had hit the Fed’s target since early 2014.

The Fed will have two more jobs reports — and a historic elections result — to consider before the December 13-14 meeting.

Brian Jacobsen of Wells Fargo Funds agreed there is little evidence Fed decision making has been dictated by the political calendar in recent memory.

His research has found nearly a third of all rate hikes happen in election years. In 1988, the Fed met a week before election day and raised rates. Vice President George HW Bush went on to defeat Massachusetts governor Michael Dukakis in a landslide.

“Most of the evidence suggests that every time the Fed has hiked, and even when it has eased, since 1978, it has been in response to the economic environment and not in response to the election calendar,” Jacobsen told AFP.

This is not to say the Fed has never been buffeted by political winds. Richard Nixon bullied Fed Chairman Arthur Burns into easing monetary policy ahead of the 1972 elections. “Just kick ‘em in the rump a little,” Nixon told Burns as he urged him to pressure other FOMC members to lower rates in a recorded telephone conversation.

George HW Bush blamed Fed Chairman Alan Greenspan for his failure to win reelection in 1992, saying rates had not come down fast enough.

Sarah Binder, senior fellow at the Brookings Institution, said the Fed’s independence is tempered by its need to avoid political storms.

“Their life is not made any easier by becoming the target of angry lawmakers,” Binder told AFP. “I think in reality the Fed needs political support to make tough choices. Getting aggressively out of synch of political and public opinion, that’s a tough thing to do.”