Fed officials’ hawkish inflation rhetoric undermines market

CNBC’s Jim Cramer said inflation was falling at a healthy pace on Tuesday as he called out Federal Reserve leaders for hawkish comments that are dragging the market down.

“As we hear from Fed officials, hedge fund managers and strategists offering their thoughts on how the Federal Reserve will need to double the fed funds rate to stop runaway inflation, ask yourself what commodities , what goods they’re actually talking about,” the “Mad Money” host said.

Chicago Fed President Charles Evans said on Tuesday he hoped for lower interest rate hikes going forward, starting with a half-percentage-point increase in September, followed by increases of a quarter of a percentage point until the start of the second quarter of next year.

By contrast, San Francisco Fed President Mary Daly said the central bank was “far from almost done” with interest rate increases, and Cleveland Fed President Loretta Mester , warned that policymakers are not in a position to change their stance on the fight against inflation.

Cramer pointed to falling commodity prices, including lumber, copper and aluminum, to illustrate his point. He acknowledged that oil is still high, but reminded investors that gas prices have fallen at the pump.

Job postings fell in June to their lowest level since September 2021, suggesting the market is starting to slow. Plus, inventory gluts at stores like Walmart mean prices for goods on the shelves will be cheaper, he added.

“I don’t know how far the prices have to go before these people notice,” Cramer said.

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