The FOMC Announcement, from Charles Pennington
The FOMC announcement did nothing to moderate the extremes in yield curve steepness that Rocky was talking about. Here are the moves from 2pm to 3:30pm (EST) in some bond futures:
put
FV (five year) +8/32
TY (10-year) -3/32
US (30-year) -2 24/32
UB (ultra) -4 19/32
Very roughly speaking, TY should move roughly twice as much as FV, and US roughly twice as much as TY, but obviously that's not what happened.
I think the FOMC gets a little thrill out of being able to say "I like the five-year today" for no reason and then push a button and blast it upward. Buckley's first 100 names from the Boston phone-book would do a better job, and a true market would do even better than that.