The consequences of the Iran war became even more conspicuous for consumers this week, with the national average gasoline price rising above $4 a gallon for the first time since 2022. Thankfully, the larger-than-expected rise in retail sales in February and the better-than-expected increase in the ADP payrolls measure in March provide some support to the idea that the labour market was enjoying more momentum heading into the oil price shock than the fall in payrolls in February suggested. The true test will be on Friday with the release of the March Employment Report although, with equity and bond markets closed for Good Friday, we will have to wait until Monday to gauge the full reaction from investors.
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