With income growth strong and the labor market set to tighten through 2006, the overall growth outlook should remain robust.
There's no sign of inflation, and the labor market is still weak. There's still plenty of room from the Fed's point of view.
The big wild card becomes what the Fed does about it. That's why the bond market is rallying -- rather than concentrate on the inflationary aspects of higher oil prices, the market thinks the Fed will focus on the growth aspects.
All told, we have more of the same. The economy is going to accelerate in some areas and decelerate in others and the labor market is going to be the one that keeps getting squeezed.
The market liked what it didn't see. The market got itself worked up about the Fed possibly being more aggressive about inflation and when that didn't appear in the minutes, investors then focused on a relatively benign view of inflation.