• CNBC’s Jim Cramer on Thursday said the Federal Reserve is closer to winning its battle against inflation than Wall Street might believe.
• He explained that there’s confusion about whether the Fed has tamped down inflation enough due to a bifurcation in the economy.

CNBC's Jim Cramer on Thursday said the Federal Reserve is closer to winning its battle against inflation than Wall Street might believe.

"Price stability … is right around the corner," he said, adding that the Fed "just needs to be aware there's really only one area of strength left in this entire economy."

Stocks slipped on Thursday, reversing earlier gains as Wall Street's concerns about the central bank's interest rate hikes overshadowed strong corporate earnings.

Cramer explained that there's confusion about whether the Fed has tamped down inflation enough due to a bifurcation in the economy between the services side, which is booming, and the goods side, which is in a bust. 

There's the added factor that it's largely wealthy people who haven't seen a dent in spending power, which has allowed them to continue to spend on both travel and retail, he added.

"The Bed Bath & Beyonds of the world most likely won't come back. But the high ends like Tiffany, purchased by LVMH, they are crushing it," he said. "But that doesn't represent the real economy."

In other words, disproportionately high spending from people with large incomes is likely clouding the true state of inflation, according to Cramer. 

"Maybe [Fed Chair] Jay Powell's made more progress fighting inflation than [his] colleagues want to believe, except for this one area," he said.

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