From my perspective it leaves the door open to further rate hikes. Remember: the Fed is taking back what they gave last year, which suggests they will raise rates one more time and then see what to do after that.

That is the one significant overriding factor that will dominate the market's attention next week. There appears to be an almost even 50-50 chance they'll move.

It's obviously a very market friendly report. It reduces the chance of the Fed moving in October, but it does not take the Fed completely out of the game.

The question is whether it would do that on it's own and the Fed seems to be telling us they don't think so.

The key question is whether the Fed has credibility in regard to keeping inflation down, and the answer is yes. So long as they get their message across to the market in a clear way -- that it has to be a two-way street to slow the economy without killing it -- then I don't think there will be any surprises.

It confirms that they see what many in the market see, which is no significant sign of inflation, but there are signs that artificially low prices are beginning to recover. Right now the Fed is enjoying the ride and riding on their credibility. There's no reason for them to raise rates and change that.