NEW YORK (TheStreet) -- The 223,000 new jobs created in April was certainly good news for the markets, but it doesn't settle the debate on whether the economy is growing fast enough to push the Federal Reserve to raise interest rates anytime soon.

The nation's unemployment rate slipped to 5.4% last month, the Labor Department said Friday, the lowest since May 2008. The report was almost exactly in line with forecasts.

While Wall Street rallied on Friday's jobs report, the markets are still hung up on the outlook for both stocks and interest rates.

One side of the narrative is that the economy is stalling, meaning rates will stay near zero for longer. That view was fueled by the economy's dismal first-quarter growth rate of  0.1%. That led economists such as Bank of America Merrill Lynch's Ethan Harris to cut outlooks for the second quarter and the year.

In this view, the economy will be lucky to match last year's 2.4% growth rate as productivity and investment peter out and inflation falls even farther below the Fed's 2% target.

The other has been a bottom-up view that maybe things aren't quite that bad. Interest rates have been rising without any Fed intervention, as conditions in Europe improve and corporate earnings come in better than most analysts expected.

Merrill Lynch strategist Savita Subramanian points out that after 80% of S&P 500 (SPY) companies reported, first-quarter profits were actually on pace to improve slightly from last year's first quarter.

Excluding energy companies hammered by falling oil prices (which will eventually boost consumer spending and more than offset their cuts in investment), profits are actually up 8%.

"What EPS recession?" Subramanian wrote on Monday.

The jobs report doesn't neatly fit either narrative -- and that means no clear outlook for rates yet.

On the plus side, some cyclical industries did terrifically last month. Construction added 45,000 jobs -- something that would be a clear sign of a pickup if not for the sluggish level of housing starts by companies like D.R. Horton (DHI) and PulteGroup (PHM) and commercial construction. Leisure and hospitality added 17,000, in a sign of more disposable income.

The only big minus was 15,000 jobs lost in the mining sector, where the impact of the cuts in oil drilling by the world's Exxon Mobils (XOM) and Halliburtons (HAL) shows up.

Americans, meanwhile, are feeling somewhat better about their job prospects. According to a recent survey conducted by Gfk for TheStreet, confidence in job security is high in the U.S., but less than a third of Americans are very confident they have the right skills to land another gig in a jam.

Hitting the forecast almost exactly means the report won't change the market's balance of fear and greed very much. But off the bat, stock investors liked it -- the market began rallying minutes after the news -- in a kind of relief rally after a very weak ADP report Wednesday on private-sector April hiring sparked caution.

On balance, the report is a relief. At least the news wasn't worse. And that tends to mean that the Fed is still on track to tighten late this year, between September and December.

"The Fed says they are data dependent, but I think the Fed is concerned they have kept rates so low for so long and I think they'll take the risk of beginning to tighten," Jerry Webman, chief economist of OppenheimerFunds told TheStreet TV on Friday. "That's why September looks reasonable, even though we're seeing these neither here nor there kind of [jobs] numbers."

It also suggests that the second quarter may not be as tough as some early data, especially on trade, had suggested. So that would help stocks. It puts a little bit more weight on the side of the argument that points to rising wages and home prices as a sign that consumer spending will bounce back from its first-quarter lull and bring the rest of the economy with it.

But that's just today's view. Next week's retail sales report, and the last first-quarter earnings reports, start the argument all over again -- since the jobs report really wasn't decisive enough to settle it.

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