Was it "new month" trading?  Or was it a reaction to abysmal sales data from GM?  Does it matter if the net effect was a nice move lower for rates?

Yes and no...

This morning's market movement was tricky business because the GM news happened right at the 9:30am NYSE open.  Being the first day of a new month, we may well expect some tradeflow volatility at the opening/closing bells.  In other words, bond ETF trading at the NYSE open could have contributed to the nice rally this morning.  

To be sure though, the GM sales data caught the market's attention.  Sales weren't just lower, they were 15% lower versus already downbeat forecasts calling for an 8% drop.  Moreover, inventory numbers moved to the highest levels since 2009 (104 days compared to an average day count that's roughly 60-70 days).  

GM's stock led the charge lower for multiple "risk-off" indicators.  Bonds reacted a bit more than most because traders who recently bet against lower rates were suddenly confronted with levels that forced them to cover their bets (by buying bonds).  This created a moderate snowball buying spree that took yields below the 2.28% technical level, ultimately leveling off around 2.26 and trickling down to 2.25+ by the close.  Fannie 3.5 MBS picked up nearly a quarter of a point.