Jim Cramer from CNBC noted that new economic data is pointing towards a cooling economy, which may make the minutes from the Federal Reserve’s recent meeting less relevant. The Fed members expressed concerns about inflation and were hesitant about cutting interest rates, leading to a decline in the major averages as Wall Street reacted to their comments.
Cramer mentioned that inflation might be decreasing faster than anticipated, suggesting that the concerns expressed by the Federal Reserve three weeks ago may no longer be valid. He highlighted that for consumer-oriented parts of the market, the Fed seemed to have won the day. However, he expressed hope that the Fed would recognize the changing economic data and adjust its stance accordingly.
Since then, data has shown a weaker than expected consumer price index and signs of a cooling economy in the labor report. Cramer pointed out that a decline in oil prices and slumping copper prices, along with the drop in shares of copper producer Freeport-McMoRan, indicate a changing economic landscape. This data suggests that the Fed may need to reevaluate its position.
Cramer noted that while there was commodity inflation during the Fed’s previous meeting, this situation has shifted with declining oil prices. Had the Fed seen this data earlier, there may have been less concern expressed in their minutes. Cramer indicated that updated economic indicators could lead to a more positive outlook from the Fed.
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