If you knew what to look for, today's comments from Fed Chair Powell erred on the side of dovishness--that is, they were rate-friendly.  They were also stock-friendly for that matter, which is probably why both stocks and bonds rallied in response.

In general, Powell seemed to defend the possibility that the Fed wouldn't hike rates as quickly as the low unemployment rate suggested. Unemployment is only one part of the Fed's job. They also keep an eye on inflation and financial stability. On those counts, Powell said there wasn't any clear sign of inflation accelerating above 2%, nor was there elevated risk of the economy overheating.  In other words, 'here are the reasons we DON'T need to hike rates too quickly.'

All rate-friendliness aside, Powell did remind us that it still made sense to keep hiking rates as long as job and income growth continue.  To me, however, that sort of read like Powell asking the economic expansion to put up or shut up when it comes to wages and jobs.  We know that job counts can rise, but we haven't seen wages rise as quickly as quickly as a 4% unemployment rate suggests.

Rates were slightly weaker heading into Powell's speech--thanks, in part, to the stronger Cap-Ex number in the Durable Goods data.  Afterward, we rallied back to close at the week's best levels.  10yr yields fell to 2.813 (or 2.825% at the official 3pm Close) and Fannie 4.0 MBS drifted out the door right under 102-00 (+0-02, or 0.06 on the day).