Every month markets around the world hold their breath to see what the Federal Reserve will do with interest rates.
A quarter point increase could mean a bad day for some stocks and a great day for others.
If you're an active trader in the market, Fed Days can be extremely frustrating, if not a little volatile, but CNBC's Jim Cramer has a strategy for investors to make the most out of the Federal Reserve's decision making.
DON'T MISS: Bitcoin Prices Stable As Federal Reserve Raises Interest Rates
"I used to dread these big Fed days like today. I always tried to gauge what was said, what will be said, what wasn't said, what changed from last time... it drove me nuts," Cramer exclaimed on Mad Money.
"I think it's a much better idea to use the volatility created by these meetings to buy the stocks that fit the old variety themes we've seen so far this earnings season."
The number one theme of this earnings season in Cramer's book is tech companies using generative artificial intelligence to increase their productivity.
On Wednesday, the Fed raised interest rates by 25 basis points as expected. Since March 2022, the central bank has hiked its benchmark rate a total of 11 times to a range of 5.25%-5.5%, the fastest pace of tightening since the early 1980s.
The Fed’s goal is to push inflation down to its target of 2%. Consumer prices rose 3% in the 12 months through June, down from 4% in May and a cyclical peak of 9.1% in June 2022.
“Paradoxically, today’s Fed meeting was one of the most certain and uncertain of the cycle,” Gurpreet Gill, global fixed income macro strategist at Goldman Sachs Asset Management, said in a commentary.
“A 0.25 percentage-point rate hike was fully priced in and widely expected by forecasters and investors. However, investors remain divided on whether this marks the last increase in the current tightening campaign.”
Get investment guidance from trusted portfolio managers without the management fees. Sign up for Action Alerts PLUS now.
