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Post-Jobs Trade, Yield Curves Steepening

US TSY FUTURES
  • Tsy futures trading steady to mixed on light volumes (TYM3<115k). Futures holding narrow range (no lead-in from European markets still closed for Easter/bank holiday) near Friday's lows after March employment report came out largely consistent with market expectations for another quarter point rate hike from the Fed in May.
  • March Nonfarm payroll employment increased 236,000, just above expectations for a 230,000 gain, while the unemployment rate edged down a tenth to 3.5%.
  • The labor force participation rate edged up a tenth to 62.6%, the highest since February 2020, and the employment population ratio edged up two tenths over the month to 60.4 percent, also the highest since February 2020.
  • Curves currently running steeper, 2s10s +2.857 at -56.160, though the short end is outperforming at the moment, futures have been gradually receding since the Asian session ended.
  • Limited second-tier data to start the week, Wholesale Trade Sales and Inventories MoM data at 1000ET while NY Fed Williams will attend a moderated discussion at NY University (no text) this afternoon at 1615ET.

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