Jim Cramer says sturdy January jobs report reveals the financial system can deal with extra fee hikes


CNBC’s Jim Cramer on Friday mentioned that the January jobs report reveals that the financial system will stay resilient, regardless of the Federal Reserve’s rate of interest hikes.

«If the Fed Chief desires to lift rates of interest quarter after quarter, this financial system can really deal with it. And that is the actual takeaway from this superb job progress quantity,» he mentioned.

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The US financial system added 517,000 jobs in January, crushing the Dow Jones estimate of a 187,000 achieve. That marks the largest improve in nonfarm payrolls since July 2022.

Stocks teetered on the information however finally slipped to finish the buying and selling session. The S&P 500 fell 1.04%, whereas the Nasdaq Composite declined 1.59%. The Dow Jones Industrial Average shed 0.38%.

Cramer mentioned that whereas shares fell as a result of the market is in «excellent news is unhealthy information» mode – the stronger the financial system is, the extra the Fed will possible have to lift rates of interest – the market nonetheless held up, roughly.

«My take is that the comeback from the preliminary unfavorable response within the inventory market at this time, earlier than a transfer decrease within the afternoon, has to do with religion. Faith in considering that there will not be a recession. Faith that if the Fed desires to hit us with one or two extra fee hikes, we’ll be superb,» he mentioned.

The sturdy financial information comes after the Fed on Wednesday raised rates of interest by 1 / 4 share level. Chairman Jerome Powell signaled that the central financial institution is not finished elevating charges regardless of financial indications that inflation is cooling down.

Cramer mentioned that whereas the Fed nonetheless desires to tamp down inflation extra, he believes a extreme recession is «close to inconceivable» with job progress being so sturdy.

«Anyone who thinks the Fed must swiftly lower charges later this yr as a result of the financial system’s too weak [is] clearly fooling themselves,» he mentioned.

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