U.S. Treasury bond prices tumbled in a holiday-shortened session Friday after the unemployment rate fell to a five-month low, signaling that the economy could be stronger than expected. The yield on the benchmark 10-year Treasury note surged to 4.76 percent from 4.68 percent late Thursday. Yields move in the opposite direction of bond prices. The bond market closed at 11 a.m. EDT for Good Friday; stock and many other financial markets were closed Friday, according to AP Word that the nation's unemployment rate fell to 4.4 percent in March rather than rose to 4.6 percent as expected sent the dollar higher. Foreign exchange investors welcomed news that perhaps the economy is more robust than they had thought for much of this year. The dollar rose to 119.31 yen from 118.68 yen late Thursday while the euro slipped to $1.3372 from $1.3427. «Clearly, versus the consensus number this was a surprise, particularly for those in the camp that the economy is falling off the face of the earth,» said Robert F. Auwaerter, head of fixed income portfolio management at Vanguard Group. «It clearly indicates a Fed that is on hold but is worried about inflation,» he said of the Federal Reserve, which has left short-term interest rates unchanged at its past six meetings as it tries to quell inflation without denting economic growth. Auwaerter, who noted that Friday's moves in the bond market were likely exaggerated by thin holiday trading, also said his assessment of the economy hadn't been as dour as that of some investors. «It'll be very interesting to see what happens Monday _ whether other investors throw in the towel.» Auwaerter said wage growth figures reported Friday might trouble the inflation-wary Fed. «They don't mind wages going up so long as you see productivity gains going up,» he said, speculating that first-quarter productivity growth will be weak as will a reading of the nation's gross domestic product, the broadest measure of the economy. As consumer spending accounts for two-thirds of economic activity, investors are eager for consumers to continue to ring up purchases to help shepherd the economy to a so-called soft landing. But a jump in wage pressures could keep inflation higher and prevent the Fed from lowering interest rates. The Fed stopped raising interest rates in August, breaking a string of 17 straight increases that began in 2004 as it moved to curb inflation. Despite any concerns about inflation, Friday's report would likely be viewed as welcome news for the economy by stock market investors. The Labor Department reported that employers increased their payrolls by 180,000 in March, the largest increase since December. Wall Street had been expecting an addition of about 135,000 jobs. Construction companies added jobs in March after cutting back in the prior month in part because of poor weather. Concerns about an unraveling of the housing sector have dogged investors in 2007. Recent troubles among so-called subprime lenders, which make loans to people with poor credit, have added to unease about the fate of consumers. Also Friday, the Commerce Department said U.S. wholesale inventories rose in February as expected while sales increased. Wholesale inventories climbed 0.5 percent to a seasonally adjusted $392.43 billion (¤293.45 billion) compared with a revised 0.6 percent increase for January. The initial January increase was pegged at 0.7 percent. Wholesale sales rose 1.2 percent in February after falling 0.9 percent in January. While most of the world's stocks markets were closed for Good Friday or local holidays, Japan's Nikkei stock average closed down 0.04 percent Friday. The sometimes-volatile Shanghai Composite Index rose 0.13 percent to its fifth-straight record close. It was a nearly 9 percent drop in the Shanghai Composite Index on Feb. 27 that helped touch off a global sell-off. Major U.S. stock indexes lost more than 3 percent that day, though they have recently rebounded. -- SPA