Modest Resistance, But No Big Bad Correction

Unless Friday's Consumer Sentiment data manages to surprise in some completely unprecedented way, bonds have made it through the week of economic reports and Treasury auctions without looking any worse for the wear.  Thursday saw a small amount of ground conceded, but not enough to move yields back up in to last week's range.  The initial reaction to the 8:30am data was actually slightly positive for bonds.  Selling came later, suggesting sellers had other motivations.  The recovery in the afternoon was concentrated in the shorter end of the yield curve following an article by WSJ's Timiraos discussing a 25bp vs 50bp Fed rate cut.