With Fannie 3.5's up 6 ticks on the day now to 103-28, MBS prices are high enough that we could see the characteristically early-to-reprice lenders coming out with improved rate sheets. Gains would have to hold current levels or make continued progress for more than just a small handful to reprice. Either way, we're not feeling like locking at the moment, even if it was our intention to do so by today's cut-off.

10's are down to 1.807, hitting their lowest yields since mid-December. Volume isn't especially huge into this rally, but is on the healthier side of average on the day.

RTRS - US JANUARY CONSUMER CONFIDENCE INDEX 61.1 VS DECEMBER REVISED 64.8 (PREVIOUS 64.5) - CONFERENCE BOARD

RTRS - CONSUMER CONFIDENCE INDEX MEDIAN FORECAST FROM REUTERS FOR JANUARY WAS 68.0

The Conference Board Consumer Confidence Index®, which had increased in December, retreated in January. The Index now stands at 61.1 (1985=100), down from 64.8 in December. The Present Situation Index declined to 38.4 from 46.5. The Expectations Index edged down to 76.2 from 77.0 in December.

The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was January 19.

Says Lynn Franco, Director of The Conference Board Consumer Research Center: "Consumer Confidence retreated in January, after large back-to-back gains in the final two months of 2011. Consumers' assessment of current business and labor market conditions turned more downbeat and is back to November 2011 levels. Regarding the short-term outlook, consumers are more upbeat about employment, but less optimistic about business conditions and their income prospects. Recent increases in gasoline prices may have consumers feeling a little less confident this month."

Consumers' appraisal of current conditions was less favorable in January. Those claiming business conditions are "good" decreased to 13.3 percent from 16.3 percent, while those stating business conditions are "bad" increased to 38.7 percent from 33.5 percent. Consumers’ assessment of the labor market was also less positive. Those saying jobs are "plentiful" decreased to 6.1 percent from 6.6 percent, while those claiming jobs are "hard to get" increased to 43.5 percent from 41.6 percent.