Investors need not worry about the Federal Reserve hitting interest rates after the release of the latest US jobs report, CNBC’s Jim Cramer said.
Companies hired 916,000 workers last month, according to data from the Department of Labor released Friday. However, the report also showed that the average hourly wages fell 4 cents in March.
Wages will be a key component for the Fed to measure inflation, the host of “Mad Money” said.
“Professional money managers crave growth without wage inflation, and that’s exactly what we have … nirvana for stocks,” Cramer said. “This kind of labor report gives Fed Chairman Jay Powell the green light to keep rates low.”
“I love [Powell’s] hand over more than that of the inflationistas right now, because nothing is more important to stocks and bonds than that report from the nonfarm labor department that we only got on Friday, ”Cramer said.
Cramer also pointed to a drop in oil prices as a reason for the Fed to keep interest rates at historically low levels. West Texas Intermediate futures were down more than 4% Monday.
These elements allow Powell to stick with his plan to keep rates low until the economy recovers from last year’s pandemic downturn, Cramer said.
The comments came after stocks rebounded to open the first full week of the second quarter. The S&P 500 and Dow Jones Industrial Average each jumped more than 1% to new record highs. The tech-heavy Nasdaq Composite outperformed the Dow and S&P 500, up 1.7%, and is now down about 3% from its February record.