The poem is written like a set of instructions, and the thing being made is a fish hook. It begins by turning an arrow into one: shrink it, bend it back on itself, strip off the feathers, add a weight and a float. The little steel eye, a clever detail, is the hole where the line ties on, but the poem jokes that it's there "to aid its introspection." A bent arrow does point back at itself, so the joke works.
The second half shifts the focus from the tool to the waiting. An arrow flies at its target, but the hook does nothing. The fish does all the travelling, pulled in by a flash or a wriggling bait. The speaker sounds calm, dry and a little amused, and almost admiring of the hook's patience. But the last lines add something darker. The fish tires itself out "against this irrevocable stillness," and the mood turns quiet and cold, as the hook's passive patience becomes a kind of trap.