The next Fed announcement is 1.5 weeks away and so it's time to start ramping up expectations for the details of the Fed's official QE announcement.  But wait... Aren't they buying a ton of bonds already?  

Indeed, the Fed continues purchasing both MBS and Treasuries in relatively significant quantities every day, but they do so under "emergency measures."  Markets expect the Fed to make it official in this upcoming meeting.  Why is that?

The Fed is committed to transparency.  For anyone who tuned in very much to the pre-Bernanke Fed communications, this is a bonafide fact.  They're also committed to ensuring smooth market functioning as the economy battles back from coronavirus impacts.  Under the current emergency policy, markets are left to guess how and when the daily buying amounts will be adjusted.

Given that Fed speakers have indicated the need for a protracted period of easy policy, transparency, and liquidity, they will get more mileage out of their bond buying if it's on a set schedule.  We have a pretty good idea of what that will look like based on how the buying amounts have leveled off in both Treasuries and MBS after the initial response to the biggest market volatility in March.

Combining the Fed anticipation with some risk-off vibes due to US/China trade relations, we have bonds challenging the friendly end of their recent trend this morning.  I wouldn't read too much into this, either this morning or this afternoon, but ending below the yellow line would be a positive development, all other things being equal.

Powell speaks via webcast at 11am ET.