Why are commodity prices soaring?

Surging prices for soft commodities, from orange juice to live cattle, are complicating the inflation picture. A host of agricultural commodities have climbed in recent months, driven by weather-related damage and rising climate risks around the globe, resulting in tighter supplies.

Does a decline in commodity prices mean a recession?

To Cramer, a decrease in the price of commodities indicates inflation is under control and interest rates can come down, leading to gains for consumer discretionary stocks like Amazon. CNBC’s Jim Cramer on Wednesday told investors that declining prices of commodities doesn’t mean a recession is on the way.

What happens when commodities go down?

“When commodities go down, it’s a powerful sign that inflation’s under control. When inflation’s under control, interest rates go down, as lenders are more willing to take less for their money and demand is most likely dropping anyway,” Cramer said.

Why is Jim Cramer optimistic about declining commodity costs?

CNBC’s Jim Cramer on Wednesday told investors he sees reasons to be optimistic about declining commodity costs. To Cramer, a decrease in the price of commodities indicates inflation is under control and interest rates can come down, leading to gains for consumer discretionary stocks like Amazon.