"Pivot" is the word of the day as the Fed's dot plot and Powell's press conference are being viewed as confirmation that the Fed has pivoted away from adding restriction.  This doesn't mean the Fed has moved toward adding accommodation because that would require a policy rate that promotes growth and inflation.  Rather, the pivot is a shift toward a lower amount of restriction.  The fact that bonds are rallying as much as they are on the notion of "less restriction" is a testament to just how bearish things have been. Just as striking is the fact that the pivot narrative is actually overshadowing this morning's stronger retail sales data.

To be fair, there was a brief, initial sell-off in longer term bonds but it was quickly erased, not to mention the fact that it isn't even really detectable in the bigger picture.  The following chart shows the relative movement between today and yesterday.  Perhaps just as interesting is the fact that Treasuries didn't care about the pull-back in European bonds (note the blue line is sideways during the time that the red line is moving higher).  This speaks to Treasury-specific motivations and probably to a fair amount of short-covering.

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