Ceasefire Extended With No End In Sight

• The US has opted to hold its current position with Iran, extending the ceasefire window after planned talks were cancelled. While no fresh strikes are being carried out, the blockade of the Strait of Hormuz remains in place, with key issues such as Iran’s nuclear program still unresolved.
• In the US policy backdrop, Fed Chair contender Kevin Warsh struck an independent tone, pushing back on political influence while signalling he is open to reforming the current monetary policy framework.
• US consumption data surprised to the upside, with retail sales jumping 1.7% in March, ahead of the 1.4% expected, and building on a revised 0.7% gain in February — the strongest monthly rise in a year.
• The strength in spending was supported by a sharp lift in fuel prices, with gasoline up 15.5%, alongside signs that core consumer demand remains resilient.
• In the UK, labour data pointed to underlying softness. While the unemployment rate fell to 4.9% (vs 5.2% expected), the move was largely driven by fewer people actively participating in the workforce rather than stronger hiring. Focus now turns to CPI today for a clearer read on the outlook.