To listen to the graybeards of monetary policy lately, the answer is "not much."
The International Monetary Fund said Thursday that the Fed should hold off on its initial interest rate hike until next year, extending its historic run of near-zero rates because inflation is so low.
Similarly, speeches by two Fed policy makers, Boston Fed President Eric Rosengren and Open Market Committee member Lael Brainerd, emphasized the risks to the recovery after a weather-afflicted first quarter and a very slow start to the second quarter.
So you have officials who don't want to move, and a jobs report that says they have more reason to hike rates than they had a week ago.
The number crushed expectations for about 225,000 new jobs, though the unemployment rate's climb wasn't expected. (The rate went up because 397,000 people entered the work force last month, according to the Labor Department's survey). Wages went up more than expected, reaching a 2.3% year-over-year gain in average hourly earnings.
And the report crushed expectations in the right way.
Cyclical sectors surged, with 57,000 new jobs in leisure and hospitality, as companies like Marriott International (MAR) and Starwood (HOT) are reporting near-record rates of occupancy and revenue per room.
Retail did great, adding 31,000 jobs. Construction companies added 17,000 workers, a relatively modest number that reflects how home builders like D.R. Horton (DHI) and PulteGroup (PHM) aren't seeing demand that is even half of prerecession levels.
That's already raising some expectations that the Fed will begin to move on rates as soon as June, or at least by September. Especially since May auto sales were boffo. TheStreet's Jim Cramer just said on CNBC that the market will soon divide into a June and a September camp for rate-raise expectations.
But it's too soon for a move -- and investors shouldn't make too much of the data yet.
It's too soon because this is a hugely cautious Fed -- if caution means changing policy slowly to nurture this recovery. Janet Yellen's Fed moved more slowly to end quantitative easing in 2013 than markets talked themselves into expecting, and even took months to remove the word "patient" this year from statements describing how long they'd wait to raise rates.
The speeches by Brainerd and Rosengren this week simply drive that point home. The market should listen.
Investors would be smart to tune out some of the noise coming from market pundits, whose views have fluctuated much more than actual asset prices and key interest rates for the real economy.
For example, CNBC.com is running a piece Friday declaring the end of cheap mortgages and saying the mortgage market is in "panic mode." But mortgage rates are lower than this time last year, and up only three-eighths of a percent in the last month. The 30-year fixed rate mortgage average rate is still hugging close to 4% -- very low by historical standards.
A Bloomberg pundit went on about the skyrocketing yield on 10-year German bonds -- which is all of 0.88%, the same as it was last Halloween. If an amusement park offered a "skyrocket" coaster with such a puny peak you'd ask for your money back.
For individual investors, all this is noise.
A good jobs report, especially one with wage growth that shows workers continuing to slowly reclaim purchasing power lost between 2007 and 2012, is a good thing for stocks. Marriott, for example, may benefit from lower capital costs, but it gains more when it can charge more for rooms. (And right now it has both.)
Bonds will be more volatile, albeit within relatively narrow ranges. They'll be risky for the relatively few investors who live on short-term results, but the losses on bonds in the last few interest-rate tightening cycles have been small, and were dwarfed by the gains on equities.
The bottom line?
The Fed will still wait for later in the year, if not next year, to raise rates. There's no inflation to force its hand. Trading partners, like those the IMF worries about, are still weak. And there's still a good amount of labor-market slack.
Equities will benefit. A better economy means better earnings. A bit of this may be priced in, but not all of it.
Bonds will be bonds. Their swings in value will be modest in most cases, and partly offset by the eventual gain in yield. And if you are trading bonds for the short term, you probably have more faith in your intuitive skills than you should.