The markets were rather quiet last week, althought participants flooded back from the long weekend to higher rates and a flatter curve. The flatter curve was a reaction to the much-stronger-than-expected employment report.

The March report was above expectations in all categories: nonfarm payrolls at 180,000 versus a consensus reading of 165,000, and unemployment rate at 4.4% versus 4.6%, hourly wages at a 0.3% gain compared to expectations of 0.2%, and a work week at 33.9 hours versus 33.8. In addition, nonfarm payrolls were revised higher by 32,000 in the previous two months. On the Good Friday, holiday-shortened session, the 10-year Treasury dropped 19/32nds, while the yield increased 7.7 basis points to close at 4.753%, its highest level since Feb. 22. In addition, the yield curve flattened with the spread between two-years and 10-years at one basis point versus 5.5 basis points before the release.

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