Treasuries traded ina  quiet overnight environment. The benchmark 10-year note chopped around in a range between 3.45% and 3.42%, after firming four basis points to 3.45% on Wednesday. Yesterday the Dow was up 6.7% year-to-date; the rebound since March 17 has brought it close to its calendar year high of 12,391 (Feb. 18).

The 10-year note is currently +4/32 at 101-20 yielding 3.429%. The 2s/10s curve is UNCH at 264bps wide after confirming a break of resistance at 270bps. The FNCL 4.5 MBS coupon is +1/32 at 101-27. AQ has the current coupon marked at 4.168% on the open. Here are his spread levels: +74/10yT, +64/10yrIRS, +197/5yT.

Equities are generally flat. S&P 500 futures are 1 point lower at 1323.00  while the Dow looks to open 4 points higher at 12,290. 

Commodity prices trended higher last night: light crude oil rose 0.80% to $105.10 per barrel while gold prices are up 0.55% to $1,431.35 per ounce.

Overnight News...

Speaking in Nanjing, China, Treasury Secretary Tim Geithner called for emerging nations to be more open with their currencies. He said inconsistencies on currency-policies create tension in the financial markets, but that tension that would be easy to solve if there were transparency and open markets.

"This asymmetry in exchange rate policies creates a lot of tension. It magnifies upward pressure on those emerging market exchange rates that are allowed to move and where capital accounts are much more open," Geithner said.

Geithner was promoting the idea of including the Chinese renminbi in the IMF's accounting system, called Special Drawing Rights or SDR. The move would help internationalize the Chinese currency.

"The concerned countries should have flexible exchange-rate systems, independent central banks, and permit the free movement of capital flows," he said.

Key Events Today:

8:30 - Five of the last seven weeks have reported weekly Initial Jobless Claims at fewer than 400k, and the four-week average is currently just 385k - the lowest since July 2008. Most economists are expecting a similar figure for the week ending March 26, which would further confidence about the following day's employment report for March.

"Initial jobless claims were 387K during the March BLS survey week compared to 413K in February, which bodes well for an acceleration in hiring," noted economist Bank of Tokyo-Mitsubishi.

9:45 - The Chicago Business Barometer has been soaring recently. The measure of Midwestern manufacturing and services boasted a 22-year high of 71.2 in February, marking the fourth increase in a row. Though the March figure will likely subside a bit, it should continue to indicate strength in the two sectors. The consensus from economists is for a 70 level, with estimates in a tight range between 66 and 73. 

With one day to go before the month's employment report, the jobs component will be 
closely watched along with the headline. In the February report, the jobs component fell to 59.8 from 64.1.

10:30 - Jeffrey Lacker, president of the Richmond Fed, opens conference on the Changing Landscape for Credit at the Richmond Fed's Charlotte branch.

12:00 - Daniel Tarullo, Federal Reserve Governor, speaks at the Richmond Fed conference on the Changing Landscape for Credit at the Richmond Fed's Charlotte branch.

2:05 -Cleveland Fed President Sandra Pianalto speaks on the economic outlook and oil prices.

3:00 - Jeffrey Lacker, president of the Richmond Fed, meets with reporters on the sidelines of the conference on the Changing Landscape for Credit at the Richmond Fed's Charlotte branch.