The extent to which markets are expecting a Fed taper announcement tomorrow cannot be overstated.  In fact, if the Fed announcement were reduced to a simple yes/no on the tapering question, we'd be forced to view it as a non-event. That's how unsurprising it would be.  But the Fed will also be discussing the rate hike outlook in light of the problematic inflation landscape (it's big, it SHOULD be mostly transitory, but it might not all be transitory).

The combination of tapering certainty and inflation-driven risks has helped bonds get in their preferred positions for Fed day.  Now, we wait.  Bonds are waiting too.  So far, that's taking the form of modest volume and volatility with a token correction of the recently pervasive flattening trend (i.e. 2-5yr yields are doing a bit better than 10-30yr yields whereas the opposite has been the rule since the June Fed meeting.