Don't look now, but against a slightly longer-term backdrop, bond markets merely continued in the same old ranges this week, despite being pushed nearer the weak end of that range by the FOMC Forecasts.  To be clear, that's FORECASTS, not Yellen.  I know we've been over that quite a bit since Wednesday, but it bears repeating.

While Yellen's definition of 'considerable' added a bit to the volatility and certainly had an effect on stock markets, bonds had already experienced as much selling as they would ultimately see that day.  Let me repeat that: despite all the talk about Yellen's 'gaffe,' 10yr yields ended the day at pre-gaffe levels!  No effect on bonds!

But that was Wednesday and this is today, and it marks the second day in a row that bond and stock markets have essentially "moved on," with both ending the day somewhere in the middle of Wednesday's range. 

Treasuries had a good day thanks to corporate debt hedging and tradeflows surrounding Treasury options expiries.   MBS had a good morning relative to Treasuries and leveled off into the afternoon having gained just over an eighth of a point.  Lenders were out of the gate in somewhat conservative fashion this morning, resulting in fairly widespread positive reprices in the afternoon. 

Despite the goodness, Treasuries and MBS are both closer to the weaker ends of their recent ranges, but importantly, still inside their boundaries.  It increasingly looks like it will be up to economic data (as opposed to Ukraine headlines or the Fed) to prompt a break from those ranges, and the data will be ramping up to Friday's NFP over the next 2 weeks.