02:51 PM EDT, 04/15/2024 (MT Newswires) -- The Federal Reserve may not lower its benchmark lending rate until after the US presidential election to avoid any risk of being drawn into politics, Oppenheimer Asset Management said Monday.

The 2024 US presidential election is scheduled for Nov. 5, while the Federal Open Market Committee's first policy decision after the election is due Nov. 7.

"We persist with our view looking for the Fed to cut rates in the second half of the year and perhaps not until after the election to avoid the chance that any Fed rate cuts could be considered politicized or politically motivated," Oppenheimer Asset

Management Chief Investment Strategist John Stoltzfus said.

In a bid to tame inflation, the central bank's Federal Open Market Committee increased interest rates by 525 basis points from March 2022 through July 2023. It has held rates steady since then. Last month, the FOMC's updated Summary of Economic Projections indicated policymakers continued to expect three rate cuts this year.

Annual consumer inflation accelerated at a faster-than-expected pace in March, while producer prices logged the biggest annual increase in nearly a year, data from the Bureau of Labor Statistics showed last week.

The inflation data showed that inflation was "stickier" than expected for a third month, according to Stoltzfus. "In our view, it's not about 'higher for longer' when it comes to the rate regime prescribed by the Fed this cycle, but rather a continuation of the pause as it stands for now until inflation gives up its stickiness."

Minutes from the FOMC's March meeting showed that geopolitical events posed upside risks to the inflation outlook. Iran launched an air attack against Israel over the weekend, though it caused only modest damage in Israel with no deaths, Reuters reported.

"The current increase in geopolitical risk brought about by hostilities that have increased in the Middle East over the weekend are likely to serve as a negative overhang for the market to consider until diplomacy can make progress to avoid further hostilities," Stoltzfus said.

West Texas Intermediate light crude oil was down 0.3% in Monday afternoon trade. "We don't expect an immediate reaction in crude oil prices given ample spare capacity and an already-elevated geopolitical risk premium," Australia and New Zealand Banking Group said in a note.

WTI had gained nearly 20% this year through Friday. Global economic resilience and rising geopolitical risks have propelled crude prices to their highest levels since early November of last year, Stoltzfus said.

US Treasury Secretary Janet Yellen told CNBC last week that she would not rule out measures including possible tariffs on China amid concerns over cheap green energy products. European Commission President Ursula von der Leyen called for a tough stance on China regarding its perceived unfair trade practices, CNBC reported Tuesday.