Is that how it's being understood by the fixed income crowd? Looks like bonds were a little jittery on the "news" yesterday.
The belly (5-10 years) will be most affected by good data and the tapering announcement, mainly because this portion of the yield curve had the highest allocations of purchases for QE2, OpT2, and QE4. The short-end will stay anchored because of the Fed Funds rate, but also because there is simply a shrinking universe of short-term securities and short-term funding/trading. CP issuance is down since '07, T-bill issuance is down with a shrinking deficit, IG issuance is long because of lower long-term rates, repo trading has shrunk marginally with a decrease in liquidity/risk taking by dealers, and the list goes on.
Honestly even though the short-term hit will be bad for fixed income returns, intermediate and long-term rates rising is actually pretty welcome. If you have a 5-year yielding 2-3% and a 2-year yielding 0.50%, you can pick up ~2% of 'roll-down' just by holding the bond for 3-years, which is separate from your duration/coupon returns too. Investors are going to keep pulling from fixed income if rates continue to stay low.