Investors should not worry about the Federal Reserve raising interest rates after the release of the latest report on jobs in the United States, said CNBC’s Jim Cramer.
The companies hired 916,000 workers last month, according to Department of Labor data released Friday. However, the report also showed that average hourly earnings fell 4 cents in March.
Wages will be a key component for the Fed to assess inflation, said the host of “Mad Money.”
“Professional money managers want growth without wage inflation, and that’s exactly what we have … nirvana for stocks,” Cramer said. “This kind of labor report gives the green light to Fed Chairman Jay Powell to keep rates low.”
“I like [Powell’s] they give more than the inflationists at the moment because nothing is more important to the stocks and bonds than the non-farm labor department report we received just Friday, ”Cramer said.
Cramer also noted a drop in oil prices as a reason for the Fed to keep rates historically low. West Texas Intermediate Futures fell more than 4% on Monday.
These elements will allow Powell to adhere to its plan to keep rates low until the economy recovers from last year’s pandemic crisis, according to Cramer.
The comments came after shares rallied to open the first full week of the second quarter. The S&P 500 and the Dow Jones Industrial Average jumped more than 1% to record highs. The Nasdaq Composite, which has been technologically powerful, outperformed the Dow and the S&P 500, rising 1.7%, and now has about a 3% discount on its February record.