Consumer Confidence numbers were much weaker than expected this morning at 95.2 vs 102.5 forecast.  Normally, this would be a big benefit for bonds.  While it did provide a temporary boost, the predominant momentum today has been toward higher rates. 

The weakness began before the data, right around the time that domestic bond markets come online fully at the 8:20am CME open.  Before that, overnight fluctuations in European markets had little effect and Treasuries were little changed.  Indeed, both Treasuries and MBS opened at unchanged levels before beginning the slide around 830am.

The 5yr auction, like the Confidence data, was favorable for bonds--or at least it would have been under normal circumstances.  This time around, it only made for a brief blip back towards stronger levels before the same selling momentum continued.  Several lenders have crossed into "reprice risk" territory where there's more than and eighth of a point between current prices and those in force when they put out this morning's initial rate sheets.