If the Fed is not going to do the heavy lifting, the bond market is going to do it for them.

Sentiment in the bond market has really soured.

The Fed Chairman would be very happy if the bond market did some of the tightening for him. And I think if we saw the long bond yield back above, say, 6.75 percent, edging towards 7 percent, that would limit some of the restraint the Fed would have to impose on the economy.

The Fed Chairman would be very happy if the bond market did some of the tightening for him,

It was a very strong report. It shows the rate hikes engineered by the Fed so far have had little or no impact so far in slowing the economy.

The bond market took this report as a sign that core inflation may be bottoming and the Fed may still be in the tightening business later this year.