A Democrat will win the White House next year by the narrowest of margins, according to a well-known election forecaster.
Moody’s Analytics is predicting that the Democratic presidential nominee will capture 270 electoral votes in 2016, edging out the Republican nominee’s total of 268.
The economics-based election model — which relies on presidential election results since the 1980 Ronald Reagan-Jimmy Carter contest — aims to predict voting decisions based on each state’s economic and political situation.
Moody’s will update its prediction each month in the run-up to November 2016.
Overall, the most important economic variable in the model is income growth in the two years leading up to the election.
Wage growth has been tepid this year, though it is expected to pick up as the job market approaches full employment.
But while income growth favors the incumbent party, politics matter plenty, giving the Republicans a boost.
In swing states, the share of the vote that goes to the incumbent party is about 50 percent, and economic and other factors can swing the vote to either party. The key swing states for 2016 include Colorado, Florida, Ohio, Virginia, Iowa, New Hampshire, Nevada, Pennsylvania and Wisconsin.
Voter fatigue could weigh heavily against the Democratic nominee. Several swing states would be inclined vote to for the Democrat if not for the two terms President Obama has spent in the White House, Moody’s said.
The direction of president’s approval rating could also make a meaningful difference.
If Obama's approval rating improves leading up to the election, he will probably give his party a boost. But in most elections, the president’s rating has declined in the lead-up to the election, favoring the challengers.
The Moody’s model assumes that Obama’s approval rating will be the same on Election Day as it is today.