The result was a somewhat steeper yield curve ahead of what is expected to be the week's major market-moving event - two days of Congressional testimony by Federal Reserve Chairman Alan Greenspan.
The spread between the two- and 10-year notes widened by two basis points to 74, a modest reversal after weeks of flattening.
Apart from yield curve plays, longer-dated debt was hurt after retail sales numbers suggested US economic growth may have gotten off to a solid start in 2005.
Compounding the downward trend was Treasury data for December showing a decrease in foreign capital inflows into US assets, and a particularly steep drop in purchase of US government bonds.
"One thing is for sure: there is a trend of diversifying out of low-yielding Treasuries into higher-yielding corporate bonds," said Alex Li, interest rate strategist at Credit Suisse First Boston.
As for his thoughts on Greenspan, Li echoed a sentiment expressed by many in the market that the Fed chief could signal that future policy statements might omit the word "measured" in reference to the pace of monetary tightening.
For now the data were not especially friendly to Treasuries. Retail sales fell 0.3 percent in January, dragged lower by a sharp drop in autos. But excluding cars, sales rose a healthy 0.6 percent, beating forecasts for a 0.4 percent gain.
Some of that was attributed to higher gasoline costs, but overall strength in retail and merchandise gave the figures a bond-negative tone. Weekly retail sales data also pointed to robust consumer expenditures.
Treasuries suffered further after data showing net inflows of capital into US assets eased to $61.3 billion in December. While the overall drop matched expectations, some were caught off guard by a steep decline in US government debt buying, to $7 billion in December from $21 billion in November.